
LIBRARY OF CONGRESS 







































































































* A * 


<* A V«'\ -» 



e V V 4 

: W : 

* v ** • 




- **„ ^ - 




. aV** 

.* ** ^ 


•»..* A <» *'..•• , 0 ' %, 

o A .ojfl**, , 0 V c 



*0 . t * ,<\ <.'*»! 

a* v \ 

■»■_ A "’•fV A 


*>°^ 



^ " * * 1 " 

. V»» *> V* .‘VL% A > „ 

*- a ♦vofev. ^*v ,A / 



•. ’W : 

: /V *• 

,' /y ** * 




. A V ^ ■• 

/ -jr ^ *_ 

* *’> u .-^o 0 ■ *‘,o-.. 


^c 


4 o. 

-a? v^v * 

* * * f . O 



* * 


,V 5 • * 

V s 

°. ; 

a v 5 V • 

^ ^ °* 

4 <(y <*, 

4 ..*■*•* ^ 




o 


o 


\>* 


O v 



^ ‘V 

<0 V +**°' ■> 
4 * A^£/u # o ^ 


o * 0 

.. V ' ^a 0 


aV** 

•/ 4? *<? ‘ 



■ "o.»* A <* <** 

^o , <a> o ° w e - * 

o ^ * 

<iv 


", W ; 

• A\. °° 

% ay & * 

^ w / • 



Py 


O v 



„ t ‘ £ 

<* *£, A& *• 

* ,<A * 

A Vv V : 

r 4* ^ ^ V 

'o * * * a <"> .. 

0 o « o ^ <^ 

VN 4 

^o ^ ? 



i 0 V ^K 

O o ^ % ‘W ^ 

< VJ ^ ' 4 «> v 

i» (Z 5i . ♦ /»* ^ ^ 





♦ & ^ • 

•' V. 1 - A 



^p * 

or> V ,# 


V* ?-%. /°- 

* a 0 ' ^ *••■>** *4^ 

« 0 ’ > V 

» fi a * jv *> 


» * 



% O'- *>4^,% ^ A , 

• *^ 0 * * 0 ^ ° 

* ^5 ^ *'°*V * 

°o*. ^ ^ 

* A 

*■ 

O 


* aV^* 

* & %> \ 

A <, *'.. • 

A .»j^% % 




* ■<£>*’ 0 
* .0* ^ -•. * 

u* ^ * &i{l77/tA ... ° 



>'«*** A <> "''TV * 4 <G V o 

^o A^ c 0 * * ♦ o' t • 4 1 * + o 




A^ V C°"^ ^ 

<N « ^ 

'a ^ : 


» * 


^ 0 


H, 


A ^ SfWfj A cv O o ^ -yz/rfs <& 

> v <> v % .* 1 / 1 ;^ .0 > v' 


^ c 




V a0 v ^ '••** 

^ .<y ** t *N c>. 


V- <* 

A V c o * • ♦ 


/°V ", 

% ^<k/ & * 

* «,♦♦ A (y O. # o ♦ ^ 



o^ ,.“•. V 
































* % A? ^ ^ * 

•jS8j&2& 0 . V^ 11 


aV** 

;• ♦* % 


*P\ 

2^ O 
^ * 

* Y oV 

^ 0 \0 r£, 

^.‘ «/«** 




o* 


Vv • 


► c5*^ o 

* a? u .-> 0 

4 nCT *0_ 'a* x 

0^ t* fc,#4 

C ♦ O 


- 1 



aV-^ 

;* ** ** *. 

• A <* 


.V c »“ 0 » 

<<r «%^§5W> *V 0 - *'#m%,\ ° ,<1 „ 

‘ ^'/m* ' ^ 'J^^^’.' s ' J- 0 ^ ’. 

A 0 <S\ *' ’ A 'V '« »» A 0 ^ * ‘ ’ A* 

./ * « • o # *> V> **V* A 4 <V *»*<>, *> 

"O’ .ft A. \ - £ 5* • ^ y. < 



* ^ a^ ♦ 

• *.<* « 

* AV • 

,* A %_ 0 


Aft - 

* A* *• 

- 0 y <*<4^trv ^ , C° ♦w^-. ° 



a Jp VV A 9 ^ 

♦ N r /\ ^ ^<\V s CSJ5 r> ' «. ^ * <=z £sYlr& * h/ >h * 

* / .. ^ ^ ^-'./ % .0 

V ** V* v C\ *<y ***«,* ^> A * * **/* *c* , 9 ^ 

* jfMOTfc/V *f> ,.-£>■ * a R.,Sa .0. <; *fk A *fc 

* *“ * *M/k.\ ^ A 



v * 

0 

°» 

O, •’o'. 1 •£ ** m\ «’ .U' 'a** 

' 4 c V. e 4 0^ e * 1 ' d * ^b ^ 6 - ' ♦ -a 

.C^EV. 'V ^ .‘l^tok*. 




-^0- 

^ ^bv *« 

0 - ,a 0^ ^ * *'i 1 • ' ^ ^ * • M a 

ikV^ V ^0 ^ 




“ ^ ° L 
jf ^ °. 

<> * * • * A V 






<5> *M' A$ 

. ^ V , 

- ^ ^ * 
*. 

<- ^*** % *<y o 

(& c 0 w d ♦ O^ • 1 * 9 * ^b 

^ ,^K.. , c .* 


<9 
Jt 
O 
v> 


a : 

,* A cv '. 

" ’ * <y ,, °4- * • * • f 



V' * 

a ^ * 

0 

. ^ V l 

' ^- v * 



. A^ 1 

* ^ ^ * 
: f f :k 

* A*\ 

’ * ^y ^ 


b "«♦*'* A <> ^ ,V*’ ,G V C> ""a • * * A <> 

o A 4 ’ »ilf«. *b , 0 * t *‘A!* o, A V c“” “. % 

° ,*<5§StlfAA , 4 ° V»^ «’^Sll<' ' 

lV> .*?y ft -^^sS^xilf^SlL U ^ K ^ #*?y A W 


S- -o ^ 

?w 


^o 9 : 


« 5^p 


Aq 



0 ” *0 


0 * ***°- 


V CV ,9' 

i ^Ik A ^ A> f 

* At ^ * 

r v * 


e J,0 v*. 

^ o aK * <*57/n} <& s 

.’ O o ■%. « 

» " 0 A° 


7 * 


* A* 7 ^ v> 


,iVb 

;* ** ^ 


O. 





















ECONOMICS OE CLOTHING 
AND TEXTILES 


THE SCIENCE OF THE CLOTHING 
AND TEXTILE BUSINESS 


WILLIAM H. DOOLEY / 

n 

PRINCIPAL TEXTILE HIGH SCHOOL 
NEW YORK CITY 



D. C. HEATH AND COMPANY 

BOSTON NEW YORK CHICAGO ATLANTA 
DALLAS SAN FRANCISCO LONDON 





Copyright, 1934, 

By William H. Dooley 


No part of the material covered by this 
copyright may be reproduced in any form 
without written permission of the publisher. 

3 e 4 


Printed in the United States of America 


©CIA 73434 




PREFACE 


The Economics of Clothing and Textiles was written to give 
students, workers, and leaders of a great and important industry 
a working knowledge of the principles underlying the clothing 
and textile business. Since every one is a consumer of clothing 
and textiles, the book may be used, I trust, as a valuable part of 
a liberal education in the social sciences. 

Economics may be taught from three distinct points of view; 
i.e.y from the point of view of ( a ) those interested in drawing 
conclusions from simple and artificial premises by the application 
of logical and mathematical methods, whose work in the main 
has little if any relation to the actual and pressing problems of 
today and is nearly pure theory; (6) those concerned with the 
problems of forecasting future trends in business or finance, 
chiefly on the basis of statistical data; ( c ) those — constituting 
the majority — who are concerned principally with the study and 
analysis of the particular business problems of a single industry 
or group of industries, such as the manufacture and marketing 
of clothing and textiles, etc., and which have brought about a rapid 
advance in the degree of understanding of the mechanics of the 
business of the particular industry. This book, Economics of 
Clothing and Textiles , presents this last point of view in particular. 

Experience proves that though the average student completes 
the traditional high school or college course of economics in an 
abstract manner, he is unable to recognize the principles in the 
everyday work of the clothing and textile business world and also 
lacks the power of application. 

This fact is not surprising. Observation shows that many are 
able to grasp a principle in the abstract but are not able readily 
to apply this principle in practice. Therefore, the study of the 
application of the principles of economics underlying the modern 
business of the clothing and textile trades is worthy of being 
treated as a special subject in a high school, college, or special 
school. 

iii 


IV 


PREFACE 


Such a course as provided in this volume aims to give not only 
vocational training in economics but, as a by-product, a general 
education in the subject of economics. 

The author wishes to express his thanks to the following publica¬ 
tions and firms who have furnished information, tables, and other 
valuable material: Journal of Commerce (quotations and informa¬ 
tion on rayon, linen, etc.), Fairchild Publications (index numbers, 
etc.), Cotton Institute, Cannon Mills, John Wanamaker, Berg- 
dorf Goodman, John L. Lawrence Company, I. J. Fox, U. S. 
Shoe Machinery Company, R. H. Macy and Company, Cheney 
Brothers, American Woolen Company, Silk Association of 
America, U. S. Government publications, Cotton Exchange, Silk 
Exchange, Fitchburg Yarn Company, American Bemberg Cor¬ 
poration, Hickey-Freeman Company, DuPont Rayon Company. 

Acknowledgment of indebtedness is also made to the following 
teachers who have kindly read the manuscript in part and offered 
valuable suggestions: James Shea, Joseph Kane, Arthur A. 
Wacker, Margaret Sisk, Margaret Mulqueen, Jack Efron, Albert 
McLaughlin, Muriel Williams, of Southern Teachers’ College, 
Denton, Texas; and particularly to Alice Rathbun, chairman of 
the Social Science Department of the Textile High School, New 
York City, whose suggestions were many and very valuable. 

The author will be glad to receive any constructive criticism. 

W. H. D. 


CONTENTS 


PAGE 


I. Fundamental Principles.1 

Importance of Clothing. Aim of Economics. Applica¬ 
tion of Economic Principles. Terms. Utility. Wealth. 
Income. Prosperity and Depression. Production and 
Consumption. Marketing or Exchange. Competition 
and Rivalry. Demand and Supply. Distribution of Land 
and Rent. Theory of Diminishing Returns. Rent. 

Labor and Wages. Capital and Interest. The Business 
Man (Entrepreneur) and Profit. Government and Taxes. 
Summary of Distribution. Graphs. Aim of Business. 
Questions. 

II. Psychological Basis of Clothing ... 22 

Psychological Importance of Clothing, Showing the Im¬ 
portance of Sight, Color, Smell, Hearing, Taste, Touch. 
Coordination of Senses. Influence of Heredity and En¬ 
vironment. Classes of People. Different Personalities. 

Habit — Skill. Appreciation. Association. Attention. 
Interest. Judgment. Advertising Appeal. Power of 
Suggestion. Original Ideas in Design. Instincts. Ac¬ 
quired Traits. Emotions Applied to Wearing Apparel. 
Business Cycle. Cultural Development. Art of Clothing. 
Modesty. Theatrical Costumes. Religious Influence. 
Emotional Appeal. Style Inspiration. Resorts Fashions. 
Fashion and Wealth. Variety in Styles. Widespread 
Knowledge of Style. Effects of Emotion. Results of 
Change. Age in Clothing. Questions. 

III. Sociological Basis of Clothing .... 57 

Importance. Social Science. Opposing Theories. Man 
a Social Being. Dress a Social Force. Carpets. Factors 
of Society. Social Mind. Culture Mass. Culture of 
Each Race. Social Influence of Clothing. Clothing and 
Domestic Life. Progress. Use of Wearing Apparel. 
Standards of Living. The American Standard of Living. 

Social Standard Wage. Social Organizations. Business 
Organizations. Division of Labor. Private Ownership of 
v 


VI 


CONTENTS 


CHAPTER PAGE 

Property. Social Monopolies. Individual Rights. State 
Paternalism. Social Control. Religious Influences. 

Moral Code. Code of Ethics. Need of Authority. Com¬ 
mon and Statute Law. Business Ethics. Special Devel¬ 
opment of the Clothing Industry in the United States. 

Irish Immigrants. German Settlers. Progressive 
Changes. Effects of Mixed Population. Distribution 
by Age Groups. A Present Problem. The Malthusian 
Theory. Overpopulation in the Future. Underpopula¬ 
tion. Birth Rate in the United States. Vocational In¬ 
dustrial Education. Questions. 

IV. Consumption of Clothing and Textiles . .103 

Definitions. Economics for the Consumer. Utility of 
Clothing. Marginal Utility of Clothing. Marginal Con¬ 
sumer. Marginal Producer. Consumer’s Surplus. Price 
Groups in Clothing. Value. Wholesale and Retail. 

Need of Cheap Wearing Apparel. Leather. Jewelry. Nor¬ 
mal Prices. Variations in Price. Customary Prices. 
Changes in Price Levels — Index Numbers. Demand for 
Clothing. Laws of Consumption. Law of the Con¬ 
sumer’s Dollar. Variety in Use. Thrift. Cost of Living. 
Children’s Clothing. Budgets. The Clothing Budget. 
Suggestions for Economical Selection. Intelligent Pur¬ 
chasing of Clothes. Economical Consumption. Trade- 
Marks. Consumer’s Protection. Need of Cooperation. 

Cast-off Clothing. Uses for Discarded Materials. 
Questions. 

V. Development of the Production and Manufac¬ 
ture of Textiles. 155 

Systems. Agricultural or Household Stage. Textile 
Processes. Spinning. Weaving. Felting. Materials 
for Clothing. Linen. Cotton. Silk. The Feudal 
Period. Rise of Handicraft. Westward Trend of Indus¬ 
try. Spinning Wheel. Draw Loom. Beginning of Mar¬ 
keting. The Guilds. Handicraft Stage and Action. The 
Domestic System. Cotton Manufacture. Early Woolen 
Manufacture. The Industrial Revolution. Machine 
Spinning. The Factory System. Machine Age. Power 
Age. The Factory System in the United States. Euro¬ 
pean Textile Factories. Attempts at Silk Raising in the 
United States. Linen Manufacture in the United States. 
Survival of Handmade Textiles. Questions. 


CHAPTER 

VI. 


VII. 


CONTENTS vii 

PAGE 

Business Organization ; Textile and Other 
Industries.202 

Importance. The Business Man — Entrepreneur. Types 
of Organization. Single Business Man. The Partnership 
in Corporation. Cooperative Organizations. Land and 
Labor. Industrial Centers. Shifting Centers. Capital 
Goods. Capital Funds. Duties of the Entrepreneur. 

Cost of Production. Demand and Supply. Producer’s 
Surplus. Joint Costs. Principles of Management and 
Businesslike Methods. Factory Organization. Sense of 
Achievement. Integration of Business Units. Organiza¬ 
tion of Cotton Mill. Efficiency. Essential Elements of 
Success. Division of Labor. Shoe Manufacturing. Mo¬ 
nopoly of Machines. Modern Methods of Repairing Shoes. 
Clothing Establishments. Home Dressmaking. Handi¬ 
craft vs. Factory System. Effects of Specialization. 

Effects of Mass Production. Small Industries. Workers. 

Wages. Labor Turnover. Injury of Workers. Recent 
Changes in Mill Design. American Methods of Manufac¬ 
ture. Comparison of Foreign and Domestic Organizations. 
German Shoe Manufacturing. Liberty in Business. 

Codes. Questions. 

Buying and Selling. 279 

Importance of Marketing. Exchange. Merchants and 
Middlemen. Function of the Middlemen. Types of 
Middlemen. Selling Agents. Mill Selling Agent. Com¬ 
mission Merchant. Factor. Jobber. Broker. Con¬ 
verter. Wholesaler. Traveling Salesmen. Resident Buy¬ 
ers — Group Buying. Retail Stores. Department Stores. 
Selective Distribution. Qualifications of a Trader. Re¬ 
ducing the Cost of Marketing. Elimination of the Middle¬ 
man. Middleman’s Services. Why It Costs More to Sell 
than to Manufacture. Market Prices. Normal Price. 
Monopoly Price. Determination of Price. Variations in 
Price. Commodity Exchanges. Grading of Cotton. 

Buyers of Raw Cotton. Trading on the Cotton Exchanges. 

Future Cotton. Marketing of Cotton Yarn. Marketing 
of Cotton Cloth. The Wool Market. Methods of Selling 
Wool. Kinds of Wool. Financing of the Wool Trade. 
Marketing Silk. Grading and Quotations. Marketing 
Thrown and Spun Silk. Raw Silk Exchange. A Typical 
Transaction on the Raw Silk Exchange. The Clearing 
Association. Advantages of a Commodity. Exchange. 


Vlll 


CONTENTS 


Hedging. Skill and Experience Required in Hedging. The 
Exchange as an Aid in Financing. Successful Trading. 

Retail Selling, Installment Buying. Effective Salesman¬ 
ship. Questions. 

VIII. International Trade. 359 

Definition. Importance. Balance of Trade. The Linen 
Trade. The Cotton Trade. The Wool Trade. The Silk 
Trade. The Leather Trade. Rugs. The Bureau of 
Foreign and Domestic Commerce. Importance of Our 
Import Trade. Suggested Policy for International Trade. 

The Tariff. Admission of Imports. Tariff Commission. 

IX. Money and Credit. 387 

Definition. Use. Stable Money. Gold and Silver. Bi¬ 
metallism. Legal Tender. Fiat Money. Inflation and 
Deflation. Demand and Supply. Quantity of Money. 

Credit. Book Credit. Promissory Note. Check. Draft 
or Bill of Exchange. Trade Acceptance. Bank Notes and 
Government Notes. Foreign Obligations. Banks. Na¬ 
tional Banks. Notes and the Discount Function. Work¬ 
ings of a Bank. Check. Clearing House. Bank Reports. 
Weakness. Credit Function. Rediscounts. Textile 
Credit. State Banks. Savings Banks. Commercial 
Banks. Trust Companies. Exchange. Postal Savings. 
Methods of Payment. The Call Money Market. Strength 
in Banking. Value of Credit. Questions. 

X. Research and Investigation .... 427 
Importance of Research. Coal Tar Dyes. Artificial In¬ 
digo. Cotton Research. Research on Knitted Fabrics. 
Mechanical Preparation of Flax. Novel Fabrics. Syn¬ 
thetic Fibers. Rayon. Increase in Rayon Production. 

Spun Rayon. Research in Silk Production. Sericulture. 
Weighting of Silk. Need of Rubber Research. Develop¬ 
ment of Color Charts. Research in Wholesale Marketing. 
Merchandising Research. Labor Control. General 
Textile Research. Testing Laboratories. Questions. 

XI. Patents, Trade-Marks and Designs in Textiles 461 
Importance. History. The Patent System. Inventions. 

The Mule Frame. The Ring Frame. Looms. The 
Power-Loom. Knitting. Rubberized Fabrics. The Sew¬ 
ing Machine. Minor Devices. Trade-Marks. Protection 
of Designs. Design Registration. Fashion. Costume 
Designs. Questions. 


CONTENTS 


IX 


CHAPTER 

XII. 


XIII. 


XIV. 


XV. 


PAGE 

Accounting and Cost Finding .... 504 

Importance. Definition. Principles. Bookkeeping. 
Invoice. Open Account. Ledger. Balance Sheet. Inven¬ 
tory. Profit and Loss. Expenses. Production Costs. 
Cost-Finding Practices. Labor and Material. Overhead 
Charges. Methods. To Estimate Cost of Manufactur¬ 
ing. Depreciation. Apportioning Overhead Costs. Di¬ 
rect Distribution of Overhead. Regulating Costs. A 
Cost System Has Two Functions. Yarn Costs. Diagrams, 

Charts, and Graphs. Stock Records. Questions. Prob¬ 
lems. 

The Business Cycle. 543 

Definition. Types of Depression. Stages of the Business 
Cycle. The Period of Prosperity. The Period of Crisis. 

The Period of Depression. The Period of Recovery. 
Theories to Explain the Business Cycle. The Sunspot 
Theory. The Political Theory. The Overproduction 
Theory. The Speculation Theory. Theory of Unusual 
Distribution of Wealth. The Rise and Fall of Profits. 
Pessimism and Optimism. Suggested Remedies to Elimi¬ 
nate or Lessen the Evils of the Business Cycle. Increased 
Knowledge of Business Conditions. Long-Range Planning. 

Control of Credit and Prices. Government Interference. 

The Cooperation of Business. Social Effects of the Busi¬ 
ness Cycle. Crime and Suffering. Emergence of Small 
Business. Elimination of Inefficient Business Units. 
Mergers. Undesirable Trade Practices. Depression in 
Special Industries. Efficiency Methods. The Wool In¬ 
dustry. The Silk Industry. The Cotton Industry. The 
Rayon Industry. Idle Equipment. Questions. 

Transportation. 583 

Importance. The Transportation System. Types of 
Transportation. Transportation Rates. Freight Rates. 
Consolidation of Railways. Competition from Motor 
Transportation. Air Transportation. Disputes. Fin¬ 
ishers’ Disputes. Cotton-Rate Disputes. Railroad vs. 

Boat Rates. Questions. 

Advertising and Business Ethics . . . 598 

Importance. Characteristics. Advantages. Types of 
Advertising. Branded or Trade-Marked Products. 

Abuse of Trade Names. Successful Advertising. Arous¬ 
ing Attention. Advertising Space. Variety of Appeal. 


X 


CONTENTS 


CHAPTER PAGE 

Advertising Mediums. Newspapers. Magazines. Trade 
Journals. Mail. Packaging. Cooperative Advertising. 

Style Promotion. Business Ethics. Price-Cutting. 
Standards Set Up. Undermining Advertising Tactics. 

The Quality Control Plan. Advertising Ethics. Adver¬ 
tising Campaigns. Trade Associations. Provisions of 
Contract Governing Purchase and Sale of Finished Goods. 
Questions. 

XVI. Distribution of the Social Income . . . 639 

Definition. Importance. National Wealth. National 
Income. Distribution of the National Income. Riccardo’s 
Iron Law of Wages. Types of Workers. Capital and 
Labor. Labor as a Factor in Production. Dignity of In¬ 
dustry and the Worker. The Rights of Labor and Capital. 
Conditions of Labor. Unemployment. Trade Associa¬ 
tions and Labor Organizations. Collective Bargaining. 

Strikes and Boycotts. Cost of Strikes. Radical Labor 
Organizations. Peaceful Methods. Welfare Work for 
Employees. Cooperative Industry. Socialism. Govern¬ 
ment and Taxes. Public Finance. Industrial Education. 
Taxation. Sales Tax. Reduction of Taxes. Questions. 


Index 


675 



ECONOMICS OP CLOTHING 
AND TEXTILES 

CHAPTER I 

FUNDAMENTAL PRINCIPLES 

Clothing and Textiles. Clothing refers to the various articles 
used to cover the body. Most of them are composed of cloth, 
which is made by twisting into threads short thin lengths called 
fibers , and then interlacing or pressing the threads into a fabric. 
Textiles refers to the raw as well as to the finished materials made 
from the fibers. Textiles are used for more purposes than cloth¬ 
ing — house furnishings, as well as various other uses. Since the 
principal use of textiles is for clothing, we shall use the word cloth¬ 
ing frequently in the text to include all the uses of textiles as well 
as clothing. 

Importance of Clothing. The subject of clothing is one of the 
most important that confronts us all. Between 10 and 25 per cent 
of our incomes is devoted to the purchase of articles of wearing 
apparel. In addition, millions of persons are employed in the 
industries that produce the various parts of clothing. The volume 
of business involved is probably greater than that of any other 
industry, running into billions of dollars annually. No other 
subject, not even that of home furnishings, is so intimately associ¬ 
ated with our lives and contributes so much to our happiness. No 
other single element offers such unlimited opportunities to make 
us happier, more efficient, and more pleasing to our friends as the 
development of the art of dress. Therefore every problem con¬ 
nected with the making, buying and selling, and consumption of 
wearing apparel interests us and is worthy of study. Clothing as 
a whole or the combination of various articles of wearing apparel 
is sometimes referred to as the costume, and includes the head dress, 

1 


2 


ECONOMICS OF CLOTHING AND TEXTILES 


jewelry, and other personal adornments as well as the outer and 
under garments. 

The expression “ economics of clothing ” means the principles 
and methods underlying the successful management of the (a) mak¬ 
ing, ( b ) buying and selling, and ( c ) the use or consumption of 
wearing apparel to the best advantage of the state or community, 
the family, and the individual. The economics of clothing is based 
on the best experience and efforts of the human race in securing 
the raw material, preparing the finished product, and supplying 
the services to satisfy our wants and needs in these respects. 

The economics of clothing and textiles may well he considered the 
science of the clothing and textile business. 

Aim of Economics. Before considering the problems relating to 
the economics of clothing it is necessary to explain briefly some of 
the fundamental terms and principles of economics in general, as 
they might be applied to any of the major industries. Some 
understanding of these general principles is essential to an under¬ 
standing of the special problems dealing with the manufacture, 
buying, selling, and use of wearing apparel. 

The experiences of people in the past in producing, marketing, 
and consuming a commodity, such as textiles and clothing, have 
been gradually collected and classified. From these experiences 
have been evolved certain facts and theories that have been sum¬ 
marized into laws and principles of economics. These laws and 
principles represent the conclusions of people as to the causes and 
effects of their experiences. Since human beings do not always 
react in the same way, the experiences of individuals may vary, 
thus giving rise to certain variations in the conclusions that may be 
drawn from experience. For example, a dry goods merchant may 
lower the price of sheetings, naturally expecting the demand to 
increase. The demand may increase with some classes of people, 
but other classes may feel that the quality is poorer and will refuse 
to purchase at the lowered price. For this reason, some stores 
have found it desirable to keep up the price in order to convey to 
the minds of the customers that the quality is as good as ever. It 
is true generally, however, that consumers will buy more of a 
commodity when the price is lowered. Hence the principles or 
laws of the economics of clothing express the tendencies of the 


FUNDAMENTAL PRINCIPLES 


3 


majority of persons to react to certain conditions, or the tendency 
of a certain economic cause to give a certain economic reaction. 

Application of Economic Principles. We must bear in mind 
that in the economics of clothing we are not dealing with inanimate 
things, as in the case of physics, but with human beings subject in 
varying degrees to fear, over-confidence, love of distinction, thrift, 
and other human traits that change from time to time. Therefore 
when we make a statement about the economics of clothing, etc., 
the statement means only that certain given economic causes will 
in normal times produce with most people certain economic results 
unless subject to special psychological or sociological influences or 
changes. 

To illustrate: Under normal conditions the lowering of prices 
would increase sales provided the consumer has the necessary pur¬ 
chasing power. But at the beginning of the depression of 1930, 
wealthy people, although possessing the purchasing power, began 
to buy less despite the drop in prices. 

Because of these psychological and emotional reactions that 
enter into economic behavior, we see that the economics of clothing 
is not an exact science in which the principles remain constant, 
but a social science in which intangible elements must be taken 
into consideration. 

Terms. There are certain accepted economic terms used to 
explain the processes and elements in business and industry that 
will necessarily recur in our discussion of the textile and clothing 
trades. The following list includes the more common of these 
terms: production, exchange of commodities, transportation, 
taxes, money, banking, consumption, prices, wealth, values, utility, 
depression, prosperity, wages, interest, income, property, rent, 
profits, etc. 

In the discussions relating to the economics of clothing we shall 
find that many of these terms have two distinct meanings, one a 
popular meaning common in ordinary conversation, and another 
strictly technical or economic meaning. It is well, therefore, to 
know both meanings and to be careful to use the technical 
meaning in discussing economic problems. For example, in a 
general sense the term production refers to the raising of a crop 
or the development or manufacture of a product that is, the 


4 


ECONOMICS OF CLOTHING AND TEXTILES 


bringing of it into form or shape for useful purposes. The raising 
of cotton or the producing of clothing is, of course, production in 
this sense. In a strict economic sense, production refers to any 
process or change which renders a product more useful or in any 
way helps to satisfy a human want or need. Thus not only the 
raising of silk or the making of a costume may be considered pro¬ 
duction, but also any service (such as transportation) in connection 
with supplying an article to satisfy a human want. Production 
of wearing apparel is, in this economic use of the term, seen to be 
very complex, requiring the services of many factors and agents, 
all cooperating and working together, and each making a special 
contribution to the finished commodity. 

Utility. Utility is a term used in everyday life to describe a 
quality or state of being useful or serviceable and desired by man. 
An overcoat is serviceable in protecting the body from cold; 
therefore it has utility. Our wants or needs for wearing apparel 
may be divided into two classes: (1) primary or existence wants, 
i.e., clothing to cover the body for protection against the elements, 
and (2) secondary or cultural wants, i.e., wearing apparel that is 
artistic and that appeals to our friends. It follows naturally that 
clothing designed to satisfy these various desires will possess 
utility of various types. For example, a lace collar has decorative 
utility in contrast to the protective utility of the overcoat men¬ 
tioned above. 

Each piece of wearing apparel is made for the consumer and 
has its greatest utility when it is in the hands of the person who 
wants it. From the time the raw material, as cotton, is taken 
from the plant until it is completely finished as a garment and is 
in the hands of the consumer, it increases in utility. To illustrate : 
Raw cotton is secured from the farmer who raised it, and it is use¬ 
ful because it possesses elementary utility — the property which 
enables it to be carded, spun, and woven into a percale fabric. 
It has form utility when it leaves the finishing plant where it has 
been bleached and finished. When the cotton percale reaches the 
dry goods counter ready to be sold to the consumer it has place 
utility. People purchase cotton percale in spring and summer, and 
this is the period when it has time utility. Cotton percale may be 
purchased by the case, package, or yard, depending upon the buyer 


FUNDAMENTAL PRINCIPLES 


5 


and his needs. A wholesaler buys a case, a small retailer a pack¬ 
age. Each of these has quantitative utility when the buyer can 
purchase what he needs. The cotton percale in the hands of the 
middleman has possession utility , and each middleman adds to 
this utility. 

Law of Diminishing Utility. Experience shows that we receive 
our greatest satisfaction the first time we secure or wear an article 
of clothing — such as a fur coat. We do not secure as much 
enjoyment from the purchase of a second fur coat. In other 
words, we secure less and less satisfaction out of the continued use 
or gratification of wearing apparel or any other want. This 
decrease of intensity of any utility with continued consumption is 
called the law of diminishing utility and is very important in explain¬ 
ing many of the problems of the economics of wearing apparel. 

Wealth. In the ordinary sense we speak of a man having 
wealth when he has a large amount of money or real estate. But, 
strictly speaking, in economics the term wealth means a collection 
of goods and services. While money can command the use of more 
goods and services, it is itself only a symbol of wealth. An increase 
in money does not necessarily mean an increase in economic 
wealth unless it means the power to increase the supply of goods 
and services. After the World War some countries increased 
their supply of money, but the increase did not mean a proportion¬ 
ate increase in the goods and services that these countries could 
command, because the purchasing power of the money had de¬ 
creased. Economic wealth consists of material things that have 
usefulness (utility) and also services that contribute usefulness. 
Wool can be raised, bought and sold, and used to satisfy the 
desires of man. Therefore the raising of wool and the making 
of the wool into a suit means the creating of more wealth. In 
the same way clothing is wealth because it has a distinct economic 
value in contributing to good health by protecting the body from 
injury and keeping it warm. 

Commodities and Services. Commodities are services that 
satisfy human wants and that are subject to purchase and sale, 
such as wool, silk, clothing, jewelry, and dyeing service. These 
are spoken of as economic goods, and the total of such economic 
goods is known as wealth. 


6 


ECONOMICS OF CLOTHING AND TEXTILES 


Our desire for clothing or wearing apparel may be of two kinds: 
(1) Commodities — cotton broadcloth shirt, worsted suiting, 
silk costume, hosiery, jewelry, shoes, etc., all of which are concrete 
objects, and (2) services — laundering, dry cleaning, and the 
processes in finishing the cloth, such as shrinking, pressing, printing, 
and dyeing. While some economists consider only commodities 
as wealth, others include services as well. In considering the 
subject of wearing apparel we shall consider both commodities and 
services under the term wealth , since the services increase the 
usefulness or utility of the commodities. For example, cotton 
gray goods (that is, unbleached cotton cloth) may be sent by the 
mill to a finishing plant to be bleached and printed with fine 
colors in a design. While the unbleached cotton has usefulness 
as a sheeting, it has greater usefulness as a printed cotton fabric 
and satisfies an entirely different want. 

Human desires, especially in regard to clothing, are practically 
unlimited. Thus while a person may have any one want satisfied, 
the sum total of his desires is practically unlimited. Most of the 
raw materials used in wearing apparel, such as cotton, wool, silk, 
leather, etc., come directly or indirectly from mother earth. 
Hence Nature is a storehouse of great wealth, much of it unde¬ 
veloped. The industries which produce or gather these raw 
materials — such as cotton growing, sheep raising, silk cultivation, 
etc. — are called extractive industries. Study of the economics 
of clothing shows how these natural resources can be developed by 
study and research and experimentation, so that man may satisfy 
his desires to the fullest extent without waste and without exhaust¬ 
ing the supply. The development of rayon (from linters or cotton 
waste) is an example of such experimentation. With the increase 
of leisure and higher appreciation of artistic wearing apparel, it 
is possible by means of proper advertising and education to increase 
the wants of mankind by suggesting new desires and new uses for 
commodities, and thus contribute to the wealth of mankind. 

With this increase in wealth we raise the standard of living — 
that is, we increase the number of wants and desires that a person 
is accustomed to have satisfied. In other words, we increase the 
amount of necessities, comforts, and luxuries to which he is accus¬ 
tomed. Necessities are those commodities and services that are 


FUNDAMENTAL PRINCIPLES 


7 


essential to a simple, decent, and healthful existence. Luxuries 
are those things which satisfy wants that are not necessary for a 
simple and decent standard of living. 

Income. Income refers in the popular sense to the amount of 
money coming to a person or corporation at a specified time or 
during a specified period. In the economic sense it refers to the 
total advantages enjoyed by a person or community during a given 
time or during the use of a commodity or good. For instance, the 
amount of wear one receives from a suit of clothes is called the 
income or satisfaction from that garment. But while a $100 suit 
may wear no longer than a $20 suit, we receive a greater satisfac¬ 
tion from wearing it. Hence the income received is greater. 
Such satisfaction (mental) is sometimes called psychic income as 
distinguished from the tangible income received from the satisfac¬ 
tion of a material need such as warmth. Income represents one 
of the most important topics in the subject of the economics of 
wearing apparel. 

Prosperity and Depression. Prosperity in the ordinary sense 
means success as far as wealth or earning power is concerned. In 
an economic sense it means the creation of wealth and the happi¬ 
ness of the people. In other words, it means the satisfaction of 
a greater number of their wants and needs. Depression means the 
opposite, a lowering or decrease in the creation of wealth, accom¬ 
panied by unemployment and unhappiness. Fewer of the needs 
and wants are satisfied, and we have what is known as “ hard 
times.” Hence in times of prosperity we satisfy our wants of 
wearing apparel more liberally than we do in times of depression. 

Production and Consumption. As was explained in the begin¬ 
ning of this chapter, production is a term used in a popular sense 
to mean “ to manufacture,” but in a strict economic sense it means 
the creation of utilities in order to satisfy human wants. To 
illustrate: Wool is taken from the sheep’s back, washed, carded, 
combed, spun, woven, and finished, and made into a suiting. 
Nothing has been created, but the wool has been reworked and 
reshaped into a suit. 

A producer is one who creates, or who performs services, or 
whose labor tends to the gratification of human wants, such as 
the need for a woolen overcoat. The one who purchases the over- 


8 


ECONOMICS OF CLOTHING AND TEXTILES 


coat for his own use is called a consumer, and the process of 
using this overcoat is called consumption. Wool as received by 
the worsted manufacturer and spun into yarns and woven into 
cloth is called producer’s goods, while a worsted suit, when it 
reaches the consumer, is called consumer’s goods. Articles of 
clothing or wearing apparel — that is, concrete things — are called 
commodities or goods, while the performance of a process such as 
dry cleaning is called a service. Services add to economic wealth 
by increasing the life of a garment, or by adding some other utility 
to it. 

Consumption in a popular sense refers to the using up or wearing 
out of an article. In an economic sense it means the destruction 
of goods in the satisfying of human needs — as destruction of a 
worsted suit by constant use. In making a worsted suiting we 
destroy the raw wool; this stage is called productive consump¬ 
tion. The destruction of a worsted suit by wear is called final 
consumption. In a strict economic sense any one who uses up 
an article of exchangeable value in serving his own wants or in 
producing from it another article of value is a consumer. How¬ 
ever, in the first case, in using up the raw wool to make a worsted 
suiting, the manufacturer is both a producer and a consumer. He 
has consumed (in an economic sense) the raw wool, but he has at 
the same time produced a worsted suiting. 

Marketing or Exchange. Clothing and wearing apparel are 
made in a factory, and in order that they may reach the consumer 
who wishes to use them they must be transported to a place or 
shop, called a market, where they may be exposed and seen by 
those who may buy them. The process through which these 
articles pass from the time they are made, transported, exposed, 
advertised, and purchased by the consumer is called marketing. 

Under our industrial system of the division of labor, some men 
will possess an excess of one commodity, such as wearing apparel, 
while others will have an excess of certain other commodities but 
a need for wearing apparel. The process of exchanging these 
excess commodities, of clothing, etc., involves their relative values, 
their transportation, etc. 

Exchange in a popular sense means to give in return for some¬ 
thing regarded as an equivalent. To illustrate: A person may 


FUNDAMENTAL PRINCIPLES 


9 


exchange one yard of silk cloth for 40 yards of cotton cloth. In 
an economic sense, exchange means the mutual giving and receiving 
of equivalents in goods, labor, or money, directly or through the 
means or medium of several transactions. Since direct trading 
or bartering of one commodity for another can not be successfully 
carried on in such a complicated society as exists today, money is 
generally used as a medium of exchange. That is, a manufacturer 
of wearing apparel sells his product for money and then buys what¬ 
ever he needs to consume — such as food, heat, furniture, etc. 

The process of exchange has developed the great field of trans¬ 
portation. Sailing and steam ships brought wearing apparel 
from one country to another and gradually developed traders who 
specialized in foreign trade. This was the beginning of the import¬ 
ing and exporting of goods. Improved transportation and com¬ 
munication by electricity have made the inhabitants of the world 
neighbors and have created the need of traders or merchants 
familiar with commodities produced and used in all parts of the 
world. 

Principles of Exchange. Buying and selling today are con¬ 
ducted by a group of buyers and sellers called professional traders. 
The agents who perform the duties of marketing are called middle¬ 
men. For example, commodities such as textiles must first be 
bought from the producer and placed in storage, then by transpor¬ 
tation brought in small lots to the various places where the retailers 
may purchase them. All of these middlemen engaged in transpor¬ 
tation, marketing, buying, and selling are increasing the value 
of the commodities they handle and are therefore productive 
agencies. 

Some of these middlemen represent the producers of a com¬ 
modity and naturally attempt to secure as high a price as possible 
for the product. Other traders will represent the consumers, who 
wish to gratify their desires with the least possible amount of 
money or effort. Some agreement must be reached between these 
different forces to determine the sum of money at which an ex¬ 
change will take place. This sum of money is called the price. 

In the ordinary sense price refers to the amount of money one 
pays for an article or service. In a strict economic sense it is the 
equivalent given or asked for in exchange at different places — as 


10 


ECONOMICS OF CLOTHING AND TEXTILES 


at the factory, in the market, or in the retail store. Hence we 
have not one but several prices for each commodity — the factory 
price, the wholesale price, and the retail price. 

Each different commodity has a certain power in exchange. 
This power is called the value of the article. When we speak of 
value in the ordinary sense we refer to the desirability or worth 
of one thing as compared with the desirability of something else. 
Thus we value silk for clothing more than cotton. In a strict 
economic sense value refers to the rate of worth, estimated in 
money or commodities, that is set upon goods by men who buy 
or sell in the market. This rate of worth is called the market value. 
This value expressed in money is the 'price. Different persons 
may value textiles and wearing apparel differently, or may value 
them more or less at different periods of time. As a result the 
market values or prices will correspondingly differ. 

The next question to be asked is: Who determines the price 
at a given time? How much for the chiffon dress? How much 
for the worsted suit? The sellers who have silk dresses and 
worsted suits to dispose of will offer these articles in the market to 
those buyers who wish to secure silk dresses and worsted suits. 
The balance finally reached between these two groups will decide 
the market price for the commodities. 

Competition and Rivalry. Textiles and clothing, like other 
commodities, are produced by many manufacturers. Hence there 
is always rivalry among the producers to sell the most and to 
dispose of their entire product. This rivalry or bidding against 
each other is called competition. Since the buyer or consumer is 
anxious to secure the lowest price, there is a tendency to lower 
prices to a minimum, or to a point that will be about equal to the 
cost of producing the commodities. This price is called the com¬ 
petitive price. If a group of sellers have exclusive control of a 
certain article, such as a special type of collar, and have the exclu¬ 
sive right to manufacture that article, they can set the price with¬ 
out danger of competition. Such a price is called a monopoly price. 
Prices of wearing apparel are generally competitive. If competi¬ 
tion is carried to an extreme there is an element of risk to industry. 
In their attempts to cut prices below their competitors, manu¬ 
facturers sometimes offer their product for less than the cost of 


FUNDAMENTAL PRINCIPLES 


11 


production. This practice naturally results in losses and in 
failures in business. 

To prevent such bitter competition, business men frequently 
seek to substitute some kind of monopoly, by trade agreements, 
consolidations, or other means. The government, on the other 
hand, seeks by means of regulation to maintain a condition of open 
competition, which is presumably the basis of economic freedom. 
The assumption is that this system will bring about a natural 
balance in prices which will cover the cost of production and give 
a fair profit to the producer while protecting the consumer against 
unreasonable monopoly prices. 

Demand and Supply. When we purchase an article of clothing 
we create a demand for that article. Even if the article of clothing 
is not worth while, we have created a demand for it. On the other 
hand, if we simply examine the article and pass it over without a 
purchase, the sales persons know that we are not interested. If 
many people did the same thing, the article would soon be removed 
and orders would be given to purchase no more because of lack 
of demand. The consumer can, therefore, actually control, if he 
wishes, the kind of clothing offered for sale. Thus by training 
consumers to appreciate good quality in articles of clothing they 
would be in a position to dictate not only the style but the quality 
of wearing apparel. 

The popular idea of a demand is a desire for the article. But in 
an economic sense, a demand requires not only a desire, but also 
purchasing power or the ability to pay for it. Supply is generally 
thought to mean the entire stock of goods, such as silk dresses, 
within reach of the market. In a strict economic sense it means 
simply that portion of the entire stock that is offered for sale at a 
given time at a particular price. 

The sellers in a market represent the sources of supply and the 
buyers represent the demand. We saw above how prices were 
determined by a balance between the selling and the buying forces. 
These prices thus represent a balance between the existing supply 
and the existing demand. The ways in which supply and demand 
affect prices will be described in detail in the chapter on trading. 

Distribution. The word “ distribution ” as used in the popular 
sense by business men means the physical distribution of com- 


12 


ECONOMICS OF CLOTHING AND TEXTILES 


modities from the manufacturer to the consumer and includes 
transportation, handling of the commodities, etc. In a similar 
sense, the word “ distributors ” is used to describe the wholesalers, 
selling agents, retailers, etc. From an economic point of view 
distribution has quite a different meaning, and refers to the division 
of new wealth among those who have produced it. In other 
words, it means the distribution of goods and services to the 
various factors that have contributed to their production. Thus 
we have land entitled to a return in the form of rent, labor entitled 
to wages, capital to interest, the business man or entrepreneur to 
profits, and the state or government to taxes. The contribution 
of each of these factors and the nature of its share of the social 
income will be considered separately. 

Land and Rent. Land in the usual sense means a site on which 
to build or a piece of ground to cultivate. In the economic sense 
land includes not only the actual soil but all the fertility, water 
power, minerals, etc., that accompany it. Because land is an 
essential part in production — either as a site for a factory, or a 
field for growing cotton, or perhaps as a source of water or wind 
power, it is entitled to a certain share of income. The amount of 
contribution made by land will vary. For instance, the factory, 
the wholesale business, and the retail business must have sites of 
land that are adaptable to the particular purpose they are to serve. 
The factory or mill must be located in a center where supplies, 
both of raw materials and finished articles, may be easily trans¬ 
ported. The land must be in a location where the labor supply 
is adequate. The buildings must be adapted to the particular 
manufacturing purpose. The selling office must be placed at a 
point close to the buying power of the community. Naturally 
some sites of land are more desirable than others for each of these 
purposes. The better sites of land thus make a greater contribu¬ 
tion to production than the less desirable sites. For this reason 
they can command a greater return in the form of rent. In the 
same way certain agricultural lands are more fertile than others 
and contribute more to production than do less fertile lands. 
They command naturally a larger rent. Thus a factory or mill 
building located on a stream where there is a waterfall or a railroad 
track will command a higher rent than the same building located 


FUNDAMENTAL PRINCIPLES 


13 


in the residential section of a town. A corner-window store 
commands a higher rent for wearing apparel than one of the same 
size located upstairs. More people passing the corner window will 
see the display than will see the same display upstairs. 

Theory of Diminishing Returns. In the cultivation of a cotton 
field or any other piece of land the yield of cotton, etc., increases 
with the addition of fertilizer and care (labor). In the beginning 
the yield of cotton is proportional to the additional labor and 
fertilizer, etc. (capital), but after a time a point is reached when 
the application of additional labor and fertilizer, etc. (capital), does 
not produce a proportional increase in the yield. This experience 
suggests a theory called the theory of diminishing returns which 
applies not only to land but to industry. The theory or law of 
diminishing returns states that in the development of any piece of 
land or industry there is a point at which the returns upon capital 
and labor are at the highest or maximum, and that after that point 
is reached the application of additional labor and capital does not 
give a proportional increase in the product (in case of land) nor a 
proportional increase in the value of the product (in the case of 
industry). 

Rent. Rent is used in an ordinary sense to refer to the amount 
of value (expressed in money) one pays to another for the use of 
property or land, buildings, machinery, tools, etc. Rent may be 
divided into two kinds: (1) Economic rent is due to the fertility 
of the soil and the location of land, and (2) commercial rent is 
that paid for the use of the buildings or land or other improve¬ 
ments. The person who owns the property is called the lessor , 
and the one who secures the use of it is called the lessee. The 
one who owns the property is called the landlord , and the one 
who secures the privilege of using it is called the tenant. 

Labor and Wages. Labor is a term used to cover all human 
efforts for the gratification of wants or the production of incomes. 
In the economic sense it is applied directly to those who contribute 
to increasing our economic goods or who render some personal 
service in return for compensation. According to strict economic 
reasoning, labor is considered as a commodity, and the price paid 
for it, or wages, must be governed by open competition, that is, by 
what labor will bring in the open market. But from our social 


14 


ECONOMICS OF CLOTHING AND TEXTILES 


background it can not be considered as such without certain 
restrictions. It must be recognized that man has a soul, is a 
member of society, and that after all society exists for the benefit 
of its members, and industry exists to supply the needs and wants 
of the members of society. 

The manufacture of clothing involves a tremendous amount of 
work and detail, and demands high standards of cooperation 
among the designers, manufacturers, and consumers, as well as 
high standards of production. The people employed are in a very 
important and artistic industry. They should work under proper 
hygienic conditions and receive a compensation that will afford 
more than a living wage, one which will stimulate them to do their 
best work, and attract a highly skilled class to the industry. A 
fair wage means an annual wage sufficient for the worker to live, 
to bring up a family in an economical manner, and to have a thrift 
account. The legislatures of many states, like Massachusetts, 
have appointed commissions with power to recommend a minimum 
wage for each class of workers in an industry. 

The term wages is used to mean the amount paid for labor, such 
as $8 per day. Salary is a form of wages, but consists of a definite 
amount, such as $50 per week, which is paid regardless of holidays, 
etc. The forces and conditions that determine the wages of labor 
are very important. We know from experience or from observa¬ 
tion and reading that the labor problem is one of the most difficult 
in the whole field of business. 

There are many rates of wages depending upon the class or type. 
The worker of one class is not in competition with the worker of 
another class. Wages and salaries range from those paid to the 
most unskilled workers to those of the highest directors of industry. 
Wages are paid according to an agreed basis, such as either (a) time 
wages, (6) piece rates, (c) commissions, ( d ) fees, (e) wages in 
product, (/) additional compensations — bonuses, etc. 

Wages must be considered from two points of view: (1) money 
wages and (2) real wages. Money wages mean the amount one 
receives, the number of dollars per week or per year. Heal wages 
mean the purchasing power of the amount in terms of com¬ 
modities, happiness, and satisfaction. Real wages do not depend 
uppn how much we can earn, but upon how much we can buy with 


FUNDAMENTAL PRINCIPLES 


15 


what we earn. This, in turn, depends on the standard of living 
that the resources and wealth of the country permit, and on the 
value of money at the given time. 

Many times, particularly during the late war, manufacturers, 
realizing the unstable value of the dollar, have agreed to increase 
or decrease wages at stated periods as the purchasing power of the 
dollar increases or decreases or as the cost of living increases or 
decreases. Tables might be constructed giving an approximate 
rather than an absolute price index. The construction of such an 
index is explained later. The demand for labor depends almost 
entirely upon the amount of capital seeking employment in a 
country, as capital is divided into a part for machinery, another 
part for raw materials, and a third part for wages. 

Capital and Interest. In the popular sense we speak of capital 
as money, and interest as the amount of money which the borrower 
pays to the lender for the use of the money. In a strict economic 
sense capital and money are very different things. The capital of 
any country means capital goods — the factories, mills, railroads, 
raw materials, machinery, etc., and not the money in that country. 
Money is the medium of exchange. Money may be considered as 
capital when used in business for production but not when used 
for pleasure. The prices of articles mentioned above under the 
head of capital depend upon the amount of money. If the supply 
of money in a country is increasing, there is no necessary increase 
of its capital or production goods. As a matter of fact, an 
increase in the money supply tends to increase or advance the 
prices of capital goods. Money produces nothing itself, but it 
can be converted into things that can be utilized in business or 
industry. 

When a man starts in the clothing or textile business he needs 
money. This money is used to buy or is the medium of exchange 
by which he buys tools, raw materials, fixtures, machines to produce 
clothing or cloth. The textile manufacturer’s real capital is not 
his money, but the tools, machines, and raw materials that he 
obtains by exchanging his money for them. The tools, machines, 
etc., are called production goods or capital. Capital in an economic 
sense may be considered as any form of wealth, except land, which 
is used in creating other wealth. 


16 


ECONOMICS OF CLOTHING AND TEXTILES 


When we produce more than we need and the excess or surplus 
is used for additional production, it is called capital. Considering 
capital from a durability point of view we may divide it into two 
classes, (a) fixed and (6) circulating. The fixed capital refers to 
mill buildings, machines, etc. Circulating capital represents 
goods which are used in a single process, such as cotton cloth, 
lawn, used in making summer dresses. 

Considering capital from the point of view of use, we may divide 
it into (a) free capital, such as coal, which can be used in more 
than one type of industry, and (6) specialized capital, which can 
be used in only one type of production — cotton. 

Due to rapid changes in the demands of society, it is not desirable 
to have too much capital in specialized commodities. For instance, 
if a manufacturer has too much capital in cotton goods, a change 
in style may cause such a form of capital to be useless. 

Capital is gradually consumed in a period of time, but the 
product of it should be sufficient to replace it. Business men set 
aside each year a depreciation or replacement fund for worn-out 
capital — machines, etc. 

Interest is generally thought of as the amount of money paid to 
the bank for the use of money or the return one receives for invested 
money. When we consider the distribution of income or new 
capital, interest is the amount that goes to capital for its share 
in production. Thus if a man borrows money to be used in his 
business, he pays interest on the capital funds. Every business, 
even if it has not borrowed, figures a certain return or interest on 
the capital investment before considering that it has made a 
profit. 

The Business Man (Entrepreneur) and Profit. The business 
man, called in economic language an entrepreneur, who organizes, 
directs, and assumes responsibility for the management of a 
business, is a definite factor in production. In return for his 
efforts he expects a reward in the form of profits. Profit in the 
ordinary sense refers to the gain or excess of receipts or returns 
over expenditures or outlay. In a strict economic sense it refers 
to the return from the employment of capital after the deduction 
of the amounts paid for raw materials and wages, and the real or 
estimated amounts for rent, interest, insurance, taxes, etc. The 


FUNDAMENTAL PRINCIPLES 


17 


amount that remains as profit after the deduction of these items 
belongs to the business man in return for his skill and enterprise 
in conducting the business. If nothing remains as profit, he 
receives no return for his effort. Upon the judgment of the 
business man and his utilization of land, labor, and capital depends 
the productiveness of the business and the amount of wealth 
that is to be distributed. 

The business man must see that his capital is all used, and that 
every man in his employ has work to do. If he has excess capital 
and excess labor, he suffers a loss of productivity and can not 
compete with others in the open market who have not the excess 
capital and labor on their hands. For example, in organizing and 
equipping a cotton mill, he must have the proper number of looms 
to utilize the yarn from the spinning department, and he must 
have the proper number of men. Every department is laid out 
for a certain number of men to give maximum production. If 
more men or more machines are added, more work will be done, 
but the production per man per machine will be less. 

Machinery in the textile industry has increased the production 
of wearing apparel and consequently has lowered the prices so 
that we can enjoy more comfort and luxury in our clothing. Ma¬ 
chinery has taken the place of many men in the mill, consequently 
machinery is in immediate competition with labor, and naturally 
the business man will try to secure the means of manufacturing 
that will cost him less. In this country machinery costs less, 
hence it replaces labor. But on the other hand, in China, Japan, 
etc., labor is cheaper, therefore it takes the place of machinery. 

Government and Taxes. Tax in the popular sense means the 
assessment or compulsory contribution placed upon persons, 
property, or business for the support of the government. In the 
economic sense it is the return that the government receives for 
its contribution to production. By maintaining peace and order, 
by regulating business relations, by furnishing trade information 
and statistics, by tariff regulation, patent and trade-mark registra- 
tration, and similar functions, the government facilitates produc¬ 
tion and in return receives a portion back in the form of taxes. 

Summary of Distribution. We have seen in the study of the 
production of clothing and other wealth that five factors contribute 


18 


ECONOMICS OF CLOTHING AND TEXTILES 


to its production and share in the distribution of the resulting 
social income. 

1. The land provides the site, raw materials, water power, etc., 
and receives its share in the form of rent. 

2. Labor performs the work and receives its share in the form 
of wages. 

3. Capital provides materials, buildings, machinery, etc., and 
receives its share in the form of interest. 

4. The business man, or entrepreneur, who organizes, plans, 
and assumes responsibility for the success or fortune of the busi¬ 
ness, receives his share as profits. 

5. The state or government protects, regulates, and aids business 
and receives its share in the form of taxes. 

The proportions in which these five factors of production shall 
share in the distribution of the new wealth they have created is 
one of the most important problems that face society today. 
Each factor magnifies its own importance and demands that its 
share be increased. Modifications of the existing basis of distri¬ 
bution may be expected in the future just as they have occurred 
in the past, but it is impossible to say just what these changes 
will be. 

Graphs. The rise and fall of the cost of production of com¬ 
modities may be illustrated by lines called graphs, as follows: 

A sheet of paper, ruled with horizontal and vertical lines that 
are equally distant from each other, is called a sheet of cross- 
section, or coordinate, paper. Every tenth line is very distinct 
so that it is easy for one to measure off the horizontal and vertical 
distances without the aid of a ruler. Ruled or coordinate paper 
may be used to record the rise and fall of the price of any com¬ 
modity. 

Trade papers and reports frequently make use of coordinate 
paper to show the results of the changes in the price of commodities. 
In this way one can see at a glance the changes and condition of a 
certain commodity, and can compare these with the results of years 
or months ago. He also can see from the slope of the curve the 
rate of rise or fall in price. 

If similar commodities are plotted on the same sheet, the effect 
of one on the other can be noted. Often experts are able to proph- 


FUNDAMENTAL PRINCIPLES 


19 


esy with some certainty the price of a commodity for a month in 
advance. The two quantities which must be employed in this 
comparison are time and value, or terms corresponding to them. 

The lowest left-hand corner of the squared paper is generally 
used as an initial point, or origin, and is marked 0, although any 
other corner may be used. The horizontal line from this corner, 



Graph Showing the Variation in Price of Cotton Yarn 
for a Series of Years 

taken as a line of reference or axis, is called the abscissa. The 
vertical line from this corner is the other axis, and is called the 
ordinate. 

Equal distances on the abscissa (horizontal line) represent 
definite units of time (hours, days, months, years, etc.), while 
equal distances along the ordinate (vertical line) represent certain 
units of value (cost, degrees of heat, etc.). 

By plotting, or placing points which correspond to a certain 
value on each axis and connecting these points, a line is obtained 
that shows at every point the relationship of the line to the axis. 

Aim of Business. Originally each family made all the clothing 
for its particular needs. The implements were crude, the oper¬ 
ators were slow. Only the nobility and the wealthy could secure 




















































































20 


ECONOMICS OF CLOTHING AND TEXTILES 


the full amount of clothing. The poorer classes did not have 
sufficient to meet their needs even when clothing was handed down 
from one generation to another. Later, groups of people became 
highly trained in the manufacturing and selling of clothing and 
devoted their whole time to this activity, which became a business. 
Thus we had people engaged full time in manufacturing cloth or 
costumes; others in buying clothing in large quantities and selling 
it in smaller quantities, etc. All of these people undertook business 
to render service to the community in order to “ make money,” 
or profit. Some business men, of course, gave better service and 
thus made more profit than others. Business men are interested 
in producing goods — i.e., articles or services that have value , 
that is, meet a definite demand. 

As we study the subject of economics of clothing we shall find 
that we are attempting to determine the laws or principles govern¬ 
ing its manufacture, exchange or marketing, and consumption. 
This study will consist of an analysis of the experiences of the 
past in the manufacture, buying and selling, and uses of clothing. 
The reasons or statements of tendencies for certain economic 
results that follow upon certain given economic causes or condi¬ 
tions will all be studied. These laws or principles are very useful 
to us in assisting us to avoid errors in the development of the 
clothing and textile trades by predicting the future and avoiding 
the recurrence of mistakes. In other words, we can profit by the 
mistakes *of the past and determine the future policies in terms of 
the success of the past. 


QUESTIONS 

1. What is the value of the “economics of clothing” to the individual 
and to the community? 

2. Does the lowering of the price of sheeting increase the demand? 
Explain. 

3 . Define and give example: production, utility. 

4 . What is the utility of a dinner jacket to a day laborer; to an opera 
singer? 

5 . How do we create wealth by raising wool? 

6. What is the problem the study of clothing presents to the indi¬ 
vidual? 


FUNDAMENTAL PRINCIPLES 


21 


7 . What function does dry cleaning play in economics of clothing? 

8. How may each of the following be called consumption : (a) Mak¬ 
ing worsted suiting? ( b ) Wearing a worsted suit? 

9 . Define the factors required in creating a piece of worsted suiting. 

10. How does the consumer dominate textiles? 

11. Explain the meaning of exchange in the medium of textiles. 

12. Contrast physical distribution with economic distribution. 

13 . In a second-hand store, why do men’s shoes bring more than 
women’s ? 

14 . If the price of summer dresses ranges from $15 to $20, who is the 
marginal (lowest price) consumer? What would happen if a $10 dress shop 
were opened in the neighborhood ? 

15 . How is the price of fall coats determined? 

16 . What other things besides price must be considered in the cost of 
a suit ? 

17 . Using cotton percale as an example, explain the different kinds of 
utility. 

18. What are the items that enter into the textile manufacturer’s 
capital? 

19 . Distinguish between fixed and circulating capital. 

20. What must be considered in locating a textile manufacturing site? 

21. Why should every girl be familiar with the problems of the eco¬ 
nomics of clothing? 


CHAPTER II 

PSYCHOLOGICAL BASIS OF CLOTHING 

Psychological Importance of Clothing. Human desires in regard 
to wearing apparel are of two general types: (a) The desire for 
the satisfaction that we receive from wearing clothing that makes 
us appear to advantage and ( b ) the desire for warmth and protec¬ 
tion against the elements. The first type is mental or psycholog¬ 
ical in character while the second type is materialistic. The 
pleasure and satisfaction we receive from clothing and jewels is 
called psychic income, and is a form of wealth, although it can not 
be transferred or exchanged. Nevertheless, as we have observed 
in the previous chapter, this psychic income is one of the most im¬ 
portant elements in the economics of clothing. 

Our sense of appreciation of beautiful things in wearing apparel 
and the knowledge of how to use them to best advantage comes to 
us through education, training, environment, and inheritance, 
that is, through our background or accumulation of instinct, habits, 
and emotions. This background governs or influences most of 
our wants in regard to clothing, and since these wants are expressed 
through the processes of the mind, it is necessary to understand 
something of the way the mind functions. The science that 
treats of the mind is called psychology. Hence we should consider 
the economics of clothing from a psychological point of view. 

The working of the mind is very complex and involves many 
reactions, all of which are more or less closely related to one another. 
For purposes of explaining the psychological basis of clothing in a 
general way we may consider the principal functions of the mind 
as thinking or reasoning, — called in common language acts of the 
intellect, — and feelings or substitutes such as sentiments or moods 
— called in common language the emotions. Another important 
element is the tendency to act, called in general language, the will. 
Logic is the science of correct thinking, that is, of forming correct 
inferences, judgments, or conclusions from any set of facts or 
circumstances. 

22 


A 


PSYCHOLOGICAL BASIS OF CLOTHING 


23 


All these elements are usually found in greater or less degree in 
each process of mental effort, but it is possible that one may be 
emphasized or displayed more than the others. 

For instance, a jewelry salesman may persuade one to purchase 
a diamond ring rather than one containing a semi-precious stone 
by stating that: (a) diamonds never change in value; (6) semi¬ 
precious stones change in value; (c) styles change in semi-precious 
stones but diamonds never go out of style. By this process of 
analysis, the salesman convinces the customer that it is wiser to 
purchase a diamond ring than one with a semi-precious stone. 
This appeal is principally to the intellect or reason. On the other 
hand, if the salesman emphasized the coloring of the semi-precious 
stone regardless of the good qualities of the diamond, he might 
secure the sale on appeal to the emotions, since color is an emotional 
quality. 

Purchases of wearing apparel may be based upon appeal to the 
reason or intellect, or with emphasis of appeal to passing moods or 
emotions. A rational person is one who forms his opinions on the 
basis of knowledge, and who has cultivated his reasoning power. 
Rational dress is a style that is sensible and can be justified by its 
logical appropriateness. 

Most of our knowledge of wearing apparel, such as the recogni¬ 
tion of fine distinctions, the development of experiences in selecting 
and judging qualities and colors, is gained through the five senses, 
— sight, smell, hearing, taste, and touch. 

Sight. Sight is the principal sense, and through it we receive 
most of our knowledge. It is the sense through which we observe 
and appreciate the fine artistic points of wearing apparel, and it 
can be developed to a high degree. The retina is the receptive 
portion of the eye, and it is extremely sensitive. It is not neces¬ 
sary here to describe in detail the way images are focused and 
reproduced and transmitted to the brain, but a thorough knowledge 
of these things has been very useful to designers of clothing. By 
means of after-images produced in the eye it is possible to create 
style effects that are really optical illusions. By the proper use 
of lines, form, color effects, etc., it is possible to make a person 
appear taller or shorter to an extent of two inches, or to appear 
twenty pounds heavier or lighter than his actual weight. 


24 ECONOMICS OF CLOTHING AND TEXTILES 

Since one of the major values of clothing is its power to satisfy 
our craving for the beautiful and artistic, it follows that our wear¬ 
ing apparel should be planned to embody the principles underlying 
beauty of line, form, color, and composition which are observed 
through sight. The wearing apparel that possesses these qualities 
in the highest form as applied to each individual is that which 
yields the greatest satisfaction and thus constitutes the greatest 
economic wealth. 

Since persons differ widely in form, complexion, features, etc., 
it is necessary to know how to apply to the individual the laws 
underlying beauty of line, form, and color. As we look at the 
clothing of a person, we find two distinct outlines, which are often 
called the lines of the costume. These outlines or ‘Tines,” which 
have much to do with the beauty and attractiveness of a costume, 
are (1) the outline of the costume itself, called the structural outline 
or design, and (2) similar outlines or “lines ” within the costume 
formed by the collar, panels, tucks, and trimmings, called decora¬ 
tive design. 

Color. Color is one of the most important factors in wearing 
apparel. It causes the chief emotional effect of the clothing and 
has distinct psychological effects. It has much influence on most 
people. The following experiments were conducted on nervous 
and insane patients in an Italian hospital. Special rooms were 
arranged with red or blue glass in the windows, and also red or 
blue paint on the walls. A violently insane patient was quieted 
after remaining in the blue room one hour. Another patient was 
at peace in his mind after passing a day in the violet room. A 
very melancholic patient became cheerful after three hours in a 
red room. Similar effects are produced by proper coloring in 
wearing apparel. As no surroundings are so inevitable as people’s 
clothes, dress must be held responsible for a certain amount of 
intended pleasure or annoyance to others. It is said that one’s 
apparel is not without a certain influence on the wearer’s own 
mind. A new color seems to bring a new atmosphere with it, 
and changes oddly enough the level of thought. Balzac, the 
French author, says that a woman’s character always finds expres¬ 
sion in her favorite color. A woman who prefers orange or green 
gowns is, he thinks, quarrelsome. Those who sport yellow hats 


PSYCHOLOGICAL BASIS OF CLOTHING 


25 


or who go clad in black without cause are not to be trusted. White 
indicates coquetry. Gentle and thoughtful women prefer pink. 
Pearl-gray is the color of women who consider themselves unfor¬ 
tunate. Lilac is the shade particularly affected by matronly 
beauties; therefore, according to this authority, lilac hats are 
mostly worn by mothers on their daughter’s wedding day, and 
by women more than forty years old. 

Smell. The organ of the sense of smell is the membrane lining 
the inner surface of the nose. Odorous particles or fumes emitted 
from a substance pass over the membrane and stimulate the nerve 
fibers. Smell resembles taste to a certain degree, in that con¬ 
tinuous stimulation will render the sense almost useless. Evidence 
tends to show that women use their noses as well as their eyes when 
they go shopping, and that sublimal or subconscious impressions 
influence purchasers. 

A garment, no matter what its quality, generally will sell better 
if there is something about it to impress the would-be purchaser 
without his knowing it. This has been tested by faintly scenting 
three pairs of hosiery of identical texture, size, and color, and 
asking the consumers to select their choice from them and another 
identical pair having only the natural, slightly rancid odor of 
newly-made hose. Half the women chose narcissus-scented hose 
as the best, while all the rest chose one of the other two scented 
pairs. No one selected the hose of natural odor. Although the 
hose used were as identical as machines could make them, the 
housewives usually gave some apparent physical reason for picking 
the “best ” pair. The most common reasons were texture, finer 
weave, sheerness, and feel. It was surprising to see them give an 
apparently profound reason for selecting the one pair when it was 
the scent which actually made them select it. 

Hosiery has been scented by a chemical that will repel mos¬ 
quitoes. Such hose are desirable to resist these insects. 

Hearing. The ear is the organ for detecting sound. It is 
aroused by vibratory movements through the air conducted to the 
inner ear. The sense of hearing, which is at birth quite inactive 
and very gradually learns to discriminate sounds, may be trained 
to detect very slight shades of tone. Experienced mechanics are 
frequently able to detect weaknesses in textile machinery, looms, 


26 


ECONOMICS OF CLOTHING AND TEXTILES 


etc., by the noise of the vibration. Imperfections in machine 
parts are likewise detected by the sound produced from the blow 
of a hammer. These sound distinctions would not be perceived 
by the ordinary listener. The rustle of silk and the crackling 
sound of stiffened linen have distinct reactions upon some persons 
while not noticed by others. 

Taste. The organ of taste is the surface of the tongue and 
palate on which are distributed nerve ends, called taste buds. 
In order that the sensation of taste may be stimulated, it is neces¬ 
sary to have the substance in a state of solution. The taste sense 
is not easily aroused, and continuous stimulation rapidly deadens 
its sensibility. The acuteness of this sense may be cultivated 
to a great extent by practice. The sense of taste probably 
influences our choice of clothing less than any other of the five 
senses. 

Touch. Next to our sense of sight we find that the sense of 
touch contributes most to our emotions and knowledge concerning 
clothing. The nerves of touch extend to every part of the body 
and receive impressions at their extremities. In the fingers these 
nerves terminate in a fold that is especially sensitive to vibration. 
When we touch an object, a flow of nerve energy or sensory impres¬ 
sion is sent through the sensory fiber to the cerebrum, forming a 
sense-perception. It is through the sense of touch that we experi¬ 
ence the softness of crepe de chine, the feel of velvet, the warmth 
of wool, the coolness of cotton, and the absorbing or drying power 
of linen fabrics. 

Coordination of Senses. The sense organs are not fully devel¬ 
oped in a child at birth. Unlike certain animal's senses, such as 
the sense of smell in a dog, a child's senses do not reach their full 
power or precision immediately. The first sense-perceptions need 
to be perfected by experience. Each sense assists the others, and 
they eventually give approximate perfection to our sense-percep¬ 
tions. Knowledge is best obtained by the combined exercise of 
all the organs of sense. Exercise strengthens the sense organs 
and makes them accurate. 

We know, of course, that we can enlarge the scope of knowledge 
to be obtained through the sense of sight by means of artificial aids 
such as the microscope and the telescope. We improve and inten- 


PSYCHOLOGICAL BASIS OF CLOTHING 


27 


sify the powers of hearing by similar aids and by special practice. 
The surgeon trains his hearing, touch, and sight. In the same 
manner the expert finisher on cloth trains his sense of touch until 
he can detect in the texture of fabrics slight differences that are 
not visible. 

Most of our education is obtained by the exercise of our five 
senses, either separately or in coordination. Thus the eyes and 
the fingers work together in sewing, in judging the quality of 
fabrics, in dressing ourselves, etc. These senses are all used in 
the cultivation of our instincts and innate tendencies, particularly 
in the tendency to imitation. These tendencies will be explained 
in more detail later in the chapter. 

Heredity. In addition, our fine sense of appreciation of clothing 
is due to our inheritance and environment. To illustrate: All 
living forms, called organisms, reproduce others which at maturity 
closely resemble their parents. This process of transmitting like¬ 
nesses from one generation to another is called heredity. As the 
result of very careful observations, certain theories or laws of 
heredity have been advanced by scientists to explain the specific 
resemblance of the offspring to parents and the variations that 
occur in the numerous offspring. These observations have shown 
that while this resemblance is close, it is never exact. That is, 
while the offspring may have certain likenesses, traits, and char¬ 
acteristics of the parents, they may also possess many traits quite 
different. Then again, organisms closely related may possess 
so many characteristics in common that the offspring from the 
mating of two such organisms will not be strong and well-developed. 

Biology shows that many human traits, such as good intelligence, 
low intelligence, a strong physical constitution, and musical, 
mathematical, or mechanical ability, are transmitted from genera¬ 
tion to generation. To illustrate : If a person has been supplied 
at birth with a poor mental equipment, a definite limit is set to 
the improvement of which he is capable. That is, he may at 
twenty years of age have a physical development equal to his 
years but a mental development equivalent to that of a child of 
twelve. The same is true with regard to the efficiency of certain 
mechanical traits. An inherited ability that is of small value 
at birth will tend to remain of low value during life. However, 


28 


ECONOMICS OF CLOTHING AND TEXTILES 


heredity is only one of two factors that influence a person’s develop¬ 
ment. Environment frequently modifies hereditary traits and 
offers one means for overcoming inherited weaknesses or for 
cultivating inherited abilities. 

Environment. Environment consists of both the physical and 
social contacts or surroundings of an organism, that is, the condi¬ 
tions of nature and human life in which the living thing finds itself. 
These conditions will affect its development in both structural 
form and in the ways in which the various organs work, i.e., the 
functional activities of the organism. For illustration : The chief 
differences between savages and civilized persons are those pro¬ 
duced by environment. The inherited traits have been further 
developed among civilized societies. Civilization may be said to 
possess the following characteristics: (a) a strong spirit of co¬ 
operation, (b) an increase in the amount of knowledge so that a 
maximum number of human needs are met, (c) a constant effort 
to improve and readjust conditions so that human needs are met 
more effectively and more efficiently, (d) an increase in the number 
of people that may enjoy the fruits of knowledge, and ( e ) an 
attempt to eliminate destructive social practices. 

Classes of People. The late William James — one of the 
world’s greatest psychologists — divided people into two opposing 
groups. One he called the “tough-minded,” and the other 
“tender-minded.” By tough-minded he meant those who push 
forward, often rather ruthlessly, and accomplish things. Under 
the tender-minded he grouped all these sensitive and retiring 
people who are thinking rather than doing. Take an invention, 
by way of example. The inventor himself — the one who through 
genius brings something new into being — is usually a rather timid 
and retiring type of person who is shut up within himself and his 
ideas, and knows comparatively little about the ways and harsh¬ 
ness of the world. 

If it were only through the efforts of such a tender-minded 
person, however, no invention would perhaps ever be marketed 
and exploited. The people at large would not profit by the 
invention no matter how useful or revolutionary it might be. So 
along comes a tough-minded individual, a keen business man who 
knows all the “ropes” of manufacture and competition. He puts 


PSYCHOLOGICAL BASIS OF CLOTHING 


29 


the invention “across,” as the saying goes. Both kinds of 
minds have their uses. The world could ill afford to do without 
either. 

In using the terms “tender-minded” and “tough-minded” Pro¬ 
fessor James surely meant no disparagement to either. “Tough,” 
in this sense, merely signifies a certain dynamic force and strength 
of character so necessary in these modern days if one is not to be 
“snowed under.” 

Perhaps better terms for these opposing types are those which 
the psycho-analytic school of psychology employs. The tender- 
minded they call the “introverts”; the tough-minded are called 
the “extroverts.” 

From our economic point of view it is very desirable to have 
these two classes of people with their different talents, so that the 
wearing apparel industry and other trades may have one group 
inventing new machines, new processes, and new designs, made by 
the “introverts,” while the “extroverts” commercialize their 
inventions, processes, and designs and make them applicable 
to meeting our new wants. 

Different Personalities. Because no two persons have exactly 
the same heredity and are subjected to exactly the same environ¬ 
ment, it follows that no two people in the world are exactly alike. 
We differ in amount of vitality, weight, color of eyes and hair, and 
other physical features. While certain instincts and traits are 
common to human beings the world over, these instincts and traits 
are not present in equal intensity. To illustrate: I may find 
William more sympathetic than Edward, Catherine more sociable 
than Ann. It is the shades of difference in instincts and traits 
that give us so many personalities. All are different. 

Dress and Personality. Since dress can bring out the strong 
artistic points and cover up the weak points of our personalities, 
it follows that we should dress so as to make the best of our¬ 
selves. As no two people have exactly the same personality, it 
follows that no two people should dress exactly alike in all details. 
While the same types may wear approximately similar wearing 
apparel, each one should study her own personality and see if 
there are not certain details that may be considered distinctly 
individual to the person. 


30 


ECONOMICS OF CLOTHING AND TEXTILES 


The clothes that we choose, the manner of putting them on, the 
care which they have received, all reveal personal traits to those 
who observe us. Right or wrong, many persons form their opinion 
of others through the clothes which they wear. 

Clothing also has a marked effect on personality. A person 
who is suitably and becomingly dressed has a self-confidence which 
the inappropriately dressed woman frequently lacks. Children 
are often vitally influenced by the clothing which they are forced 
to wear. Behavior problems are sometimes caused by ill-fitting 
or poorly constructed garments which hamper the movements of 
the child, thus causing irritation. A child who is constantly 
forced to wear soiled and torn garments sometimes becomes a play¬ 
ground problem because he is trying to overcome his feeling of 
shame and inferiority by annoying and fighting the other children. 
When his self-respect is restored by clean, well-kept clothing, he 
becomes a different child. 

Clothes have a great influence on where we go and on what we 
do. Clothes help us to get jobs and to hold them or to lose them. 
The well-dressed woman selects clothing which is appropriate to 
her personality as well as to her physique. 

Habit; Skill. The child’s first education or knowledge is 
received through the senses; that is, the child receives an impres¬ 
sion first upon the organ of sense, which is transmitted by the 
sensory nerve to the brain, where it makes an impression. As a 
result of a number of these impressions, called sense-perceptions, 
the senses are exercised, and a certain movement of the mind takes 
place, called a reaction, which is transmitted from the brain to 
the body by the motor cord. Actions that are repeated many 
times create such an impression on the part of the brain called 
the spinal column that it puts forth motor actions that become 
automatic; that is, carried on without connection with the brain 
itself. This power is called habit, or the reflex action of the spinal 
column, and is shown in walking, etc., which at first requires 
mental direction, but through repetition is performed uncon¬ 
sciously, through habit. To illustrate: The first time a boy 
dresses himself he is obliged to make special nervous effort to do 
the work, and finds great difficulty in dressing. The second time 
it may be somewhat easier. After a number of trials he is able 


PSYCHOLOGICAL BASIS OF CLOTHING 


31 


to dress. In time he can dress with very little mental effort. 
This is due to the fact that he has acquired the habit or skill of 
dressing. Each time he performed this operation it required a 
certain coordination of the eye and the hand, and finally the 
response became automatic in its action; a tract (mental) has 
been produced which can be aroused very easily. 

In order to attain skill or technique in sewing, it is necessary 
to perform exercise stitches many times before we acquire the 
skill necessary for the coordination of fingers and eyes in mak¬ 
ing correct movements. The speed is slow at first but increases 
with practice. Children can be taught needlework more easily 
than adults because their fingers and joints are pliable, and 
they can acquire new movements more readily. Some persons 
have a greater power of coordination in working the eyes and 
fingers and can acquire a higher grade of skill and achieve 
a finer degree of precision than others. Through the develop¬ 
ment of this fine needle skill, beautiful laces, hand work, etc. 
are made. 

Appreciation. With the constant acquiring of new impressions 
and habits we add to our store of knowledge a fund of observation, 
experience, training, and education. Each new impression is 
associated with former impressions. Thus our appreciation and 
needs of clothing apparel come to us from the background of our 
observations, experience, and training. We are constantly build¬ 
ing in our minds a greater number of associations with regard to 
color, line, style, etc. When we see a new article of wearing 
apparel, it either pleases or displeases us, according to the nature 
and wealth of associations and past impressions in our minds. 
These associations form the background for our opinions of wearing 
apparel. If our background is composed of high artistic standards, 
then our judgment or opinion will be good. On the other hand, if 
our background of impressions is ordinary or poor, then our expres¬ 
sion or opinion will be poor. 

In order that we may form correct standards it is necessary to 
observe carefully the wearing apparel of different persons and of 
different types and to imitate only the best standards of dress. 
In this way we cultivate excellent taste in selecting all kinds of 
wearing apparel. 


32 


ECONOMICS OF CLOTHING AND TEXTILES 


Association. All impressions received by the mind are recorded 
and constitute knowledge. However, it is not always possible to 
recall impressions. The easiest way to recall them is to arrange 
our knowledge in a way to facilitate its future use. Memory, or 
the power to recall past impressions, can be strengthened and 
trained by arranging ideas in such order that one suggests the 
other. For instance, they may be arranged in one of the following 
relationships: (a) known to unknown, (6) concrete to abstract, 
(c) cause and effect, ( d ) means and ends, (e) part and whole, 
(/) like and unlike, ( g ) object and subject, ( h ) symbol and reality, 
(i) dependent ideas, (J) contiguous ideas. 

To illustrate: We can understand the growth of raw cotton 
by beginning with our knowledge of cotton sheeting. We can 
unravel the sheeting into the thread or yarn and then untwist the 
yarn into the individual fibers. In this manner one can obtain 
an idea of the fiber as it exists in the cotton plant. In this case 
we proceeded from the known to the unknown. 

Again, one can understand the principles of dress by considering 
oneself in relation to the principles that may be applied to others. 
The application of dress to oneself is concrete, while the principles 
themselves are abstract. 

We know that the overproduction of cotton will cause the price 
to fall. In this case the cause is overproduction, the effect is the 
fall in price. 

The means for making cotton sheeting is by raising cotton. 
The cotton sheeting is the end obtained by this means. 

The trousers are a part of the suit. The suit itself is the whole. 

These illustrations are simple applications of the above formulas 
for arranging ideas for purposes of recall at a later time. The 
same formulas can be used when more complex ideas are to be 
remembered. 

Attention. Every exercise of the mind is dependent on attention, 
which is the concentration of nervous energy upon one group of 
brain cells. The completeness of this concentration determines 
whether the mental exercise is more or less productive of knowledge 
and mental growth. For the fullest degree of attention the 
following conditions are necessary: calmness of mind, healthy 
organs of sense, nervous vigor, and a healthy body. There are 


PSYCHOLOGICAL BASIS OF CLOTHING 


33 


great differences in individual capacities for attention, just as 
the power of memory or recollection varies greatly in different 
individuals and at different periods of life. Some men can easily 
commit facts to memory but are able to retain them for only a 
short time, while others require more repetition and effort in 
memorizing but can preserve the knowledge for a longer period. 
Some minds have a stronger grasp upon facts, others upon thought 
and feelings; some have great difficulty in recalling names and 
dates, but can easily recall an analogy or process of reasoning. 

The best minds have not only great power of attention, but 
also great facility for transition from one subject to another. In 
minds of universal power the readiness of transition is so perfect 
as to enable them to attend to several subjects at once, keeping 
different groups of brain cells at work and accomplishing various 
kinds of mental operations simultaneously. 

The success of advertising and salesmanship depends largely 
upon the kind and degree of attention elicited. 

Ideas are arranged in the mind in series; that is, one idea recalls 
another. This arrangement is called the “association of ideas.” 
In order to add a new idea to our knowledge it is better to attach 
it to some idea already present rather than to introduce it as an 
isolated bit of knowledge. The mind is constantly arranging and 
rearranging ideas, and this mental process is called reflection 
or thinking. 

Interest. Another point of contact in both advertising and 
salesmanship is interest. To illustrate : Everything that a person 
does is actuated by a motive; that is, it is done for a purpose. 
The impulse, which may be instinct or habit, pushes him forward. 
Any object or thought that arouses the mind of a person so as to 
make him inquire about it is said to be interesting to him. This 
interest may have to be aroused, and it is then said to be acquired. 
When the interest exists without being aroused by outside effort, 
it is said to be natural. The average person must have his interest 
aroused in order to be receptive to an idea or to knowledge. This 
interest can not be given directly. It is necessary to take a 
natural interest that is based upon an instinct and to develop it. 
This process is used extensively in advertising and selling wearing 
apparel. 


34 


ECONOMICS OF CLOTHING AND TEXTILES 


Judgment. The process of accumulating knowledge consists in 
obtaining sense-perceptions, retaining them (memory), comparing 
them, and forming a conclusion called a judgment. One might 
say that every sense-perception has a corresponding judgment. 
To illustrate: A person examining pieces of cotton, worsted, silk, 
and rayon fabrics will look at them and note that the cotton is dull, 
that worsted has depth of color, that the silk has a pearly luster, 
and the rayon a metallic luster. He will feel of the pieces and note 
that the cotton is cool, the worsted quite warm, the silk warm, 
and the rayon cooler. He will gradually build up in his mind 
associations of the characteristics of the different fabrics. This 
act of classification rests on sense-perception and memory, but 
includes the power of holding a property or quality — that is, 
an abstract idea — before the mind for analysis or comparison. 
This power is called abstraction, or the power of mental conception. 
In complex operations there is a series of judgments founded on a 
comparison of qualities and following a natural sequence of cause 
and effect, or evidence and conclusion. 

Judgment becomes more and more complicated as the intellect 
advances in development. As we grow in experience and educa¬ 
tion, facts accumulate in the mind and knowledge increases, so that 
the field for comparison becomes larger, and a greater number of 
relations and associations enter into our act of judgment. Definite 
judgments accumulate and form a fund of experience that can be 
relied upon as a basis for further judgments, and may also become 
unconscious judgments that are often called intuitions. Of course, 
we must bear in mind that in all complex mental operations there 
are series of judgments or decisions following a natural sequence 
of cause and effect. A series of judgments constitutes reasoning. 

Judgments may be simple or complex. A simple judgment 
is a direct, immediate conclusion, like an habitual reaction. A 
complicated judgment is a conclusion arrived at after a process 
of doubt, deliberation, and comparison of all the facts. 

Advertising Appeal. In order to secure a response to an adver¬ 
tisement it is necessary to carry out the following steps: (a) to 
secure the attention of the consumer, (6) to get him to concentrate 
by holding his attention, (c) to follow up by arousing a desire or 
suggesting a want or need, and (d) to secure a response. 


PSYCHOLOGICAL BASIS OF CLOTHING 


35 


This last step requires the action of will , that is, a voluntary 
and deliberate choice on the part of the reader of the advertisement. 
That function of the mind called will is the power to control one’s 
movements, feelings, and thoughts by a deliberate choice. It is 
this power that determines the amount of money or the portion 
of his buying power that will be expended by an individual. To 
illustrate : A person may desire, that is, have an impulse for a new 
suit of clothes, but has not the necessary money. There is thus a 
wish for the clothes, but the attainment of them is not possible. 
If the person does have the necessary money at the time he feels 
the desire for the suit, he wills the desired action and really buys the 
suit. Of course, before this expression of will there has been more 
or less thinking and attention given to the suit. The amount of 
clothing that a person consumes depends upon his income as well 
as upon his desires and inclination (will). In deciding how to 
spend our incomes we usually balance or weigh desire against desire 
to see which will give us the greatest pleasure (psychic income). 

The action of the will or inclination to buy wearing apparel or 
any other commodity is of course governed by associations of 
ideas in the mind that may develop confidence or fear about the 
future. The state of the public mind undoubtedly has a very 
direct influence upon buying activity. Hence during a period 
of depression even those persons having the necessary purchasing 
power are not inclined to buy. When people become panic 
stricken, whether for sufficient or inadequate reasons, they lose 
their sense of proportion and are no longer willing to take even 
the ordinary risks incident to all business operations. Under 
such conditions even an increase in the amount of currency issued 
does not sustain buying power, nor do unutilized credit resources 
necessarily result in increased lending and investment activities. 
Confidence must be revived; otherwise the existence of a potential 
reservoir of purchasing power will not be converted into an active 
buying demand for labor, capital, and commodities. Thus from 
a psychological point of view, demand — for cotton or silk wearing 
apparel or other commodities or services — is the desire, plus the 
ability and willingness to pay. 

Power of Suggestion. Our knowledge of wearing apparel, or 
of any other subject, is obtained by one or all of the following 


36 


ECONOMICS OF CLOTHING AND TEXTILES 


methods: (a) experience, ( b ) reasoning, (c) research, and (d) sug¬ 
gestion. To experience is to become acquainted with by means 
of personal trial, feeling, and other direct contacts. This means 
that the knowledge is acquired by means of one’s senses and 
judgment, which have already been explained. To illustrate: 
Examine cotton, wool, silk, or rayon. Reasoning is the method 
of obtaining knowledge by conclusions derived from facts, as by 
deductive and inductive reasoning, as in the purchase of a fur 
coat on a limited income. Research is a method of obtaining 
knowledge by experiments, as resulted in discovery of rayon. 
From the results of these experiments judgments are formed, 
as in the manufacture of rayon. Suggestion is the method of 
imparting knowledge by a hint, intimation, or insinuation, or 
any other simple way. That is, to learn by suggestion means 
that the ideas are readily accepted without investigation. 
The person accepting the suggestion has faith in the one giving 
it, and is willing to accept the knowledge by this rather than 
other methods. Most members of society are not capable of 
forming judgments on wearing apparel, etc. by complicated 
reasoning or research. They obtain their knowledge by practical 
experience and by suggestion. The greater part is obtained from 
suggestion, a form of imitation of our relatives, companions, or 
leaders. 

Much of the knowledge obtained by children and youth in the 
elementary and in high schools is by this process of suggestion, 
presented by the following method: standardized ideas, often 
called conventionalized, about science, literature, art, history, and 
morals have been accumulated out of the experiences of the past. 
This knowledge is the civilization of the people and differs for 
different races. These standardized ideas are absorbed by the 
process of suggestion arranged in teachable form. If new concepts 
are presented that are not in accord with our beliefs or present 
knowledge, the new ideas are immediately rejected or questioned 
by the conservative element of the community. 

Suggestion means accepting ideas from others. It is the opposite 
of thinking for oneself. It is a characteristic trait of human nature 
and is the means by which most of us obtain knowledge. Most 
of us do very little thinking for ourselves. Through suggestion 


PSYCHOLOGICAL BASIS OF CLOTHING 


37 


we acquire our social heritage and therefore our standards of 
clothing and dress. 

If we depended upon thinking for all our knowledge, we should 
acquire very little. Hence this power of suggestion is very valu¬ 
able, and should be cultivated, so that we can obtain from special¬ 
ists, our superiors, etc., the best knowledge obtainable for the period 
in which we are living. We can do original thinking in dress and 
other subjects only after we have acquired a large part of the 
knowledge that exists on the subject. 

Original Ideas. We hear much today with regard to original 
ideas in wearing apparel. We know that the desires and tastes of 
men and women are in the main the same today as they were 
years ago. Hence any design of wearing apparel that was once 
popular will at some time return again in modified form. The 
science of psychology teaches us that the human mind is incapable 
of conceiving any idea which is original in itself, and that an 
analysis of ideas which result from imagination proves that what 
at first appears to be an original concept is in reality a combination 
or modification of ideas already existing. 

Aside from this principle of psychology, however, it is a well- 
known fact, which is readily admitted by those engaged in the 
creation of designs, that all so-called new designs result from 
combination, coordination, adaptation, and modification of already 
existing ideas that may be expressed in terms of design. All so- 
called original design may be shown under analysis, to have been 
derived from some preexisting design or combination of designs. 
This has been true from the earliest days of our handicraft system 
of production. It is equally true today, when we find design 
creators delving through museums, libraries, archives, archae¬ 
ological ruins, books, pamphlets, etc., for old ideas which may 
be used in their entirety or may be modified and presented to the 
world as an original. Since this is true, it can readily be seen that 
the ownership of a so-called original design in wearing apparel 
would be very difficult to prove. 

This question of original designs is very important in the clothing 
and textile trades. Many manufacturers have spent much money 
investigating and reviving “new” designs. Competitors often 
attempt to steal these designs and reproduce them in inferior 


38 


ECONOMICS OF CLOTHING AND TEXTILES 


fabrics. This practice is called “ piracy,” and there is a move¬ 
ment among manufacturers to stop it. While piracy should be 
stopped, it should not be stopped on the grounds of original design, 
but of research and ownership of the result. 

Instincts. It has been explained that all human beings are born 
with certain impulses called innate qualities or instincts. These 
instincts may vary in different people, but they exist in feeble or 
more pronounced form in all of us. The principal ones that have 
influenced the economics of clothing are: (a) acquisition and 

possession, (6) collecting and hoarding, (c) rivalry, (d) cooperation, 
(e) habituation, (/) responses of attention to other human beings, 
(i g ) gregariousness, ( h ) attention getting, (i) display, (j) shyness, 
(k) imitation, (l) cleanliness, (m) curiosity, ( n ) suggestibility, 
(o) religious feeling, and (p) love for the beautiful. While psycholo¬ 
gists do not agree on the instinctive character of all of these quali¬ 
ties, their presence in human beings is sufficiently general for them 
to be discussed here as innate qualities. 

The instinct of acquisition is the desire to have something for one’s own, 
particularly the necessities of life. Every one instinctively wishes to 
acquire and possess his own clothing. 

Collecting and hoarding may be illustrated by the desire to collect and 
save many different kinds of clothing, accessories, etc. 

Rivalry is the instinctive desire or ambition to excel another — to dress 
better, to appear to better advantage, or to obtain distinction. 

Cooperation is the impulse to work with another, or together for a com¬ 
mon end. Our business system and our whole existence is built upon 
cooperation — laborers, capitalists, and manufacturers working together 
to produce clothing. 

Habituation is the tendency to become accustomed to a situation — a 
habit. We are accustomed to the wearing of clothing and to the con¬ 
ventions regulating the use of clothing for modesty. 

Responses to the attention of other human beings are instinctive and 
prompt us to see and to be guided by what other people are wearing and 
what they think of our own apparel. 

Love of distinction -is illustrated in the desire for an exhibition of clothing 
that shows superiority. 

Attention getting is a desire to be the center of attention of others. The 
happy, affectionate nature of woman has always prompted her to gain 
admiration or love. Clothing has furnished her with many of her devices 
for attracting attention and gaining distinction. 


PSYCHOLOGICAL BASIS OF CLOTHING 


39 


Gregariousness is the instinctive desire to associate with others, to live 
closely together and not to live a solitary life. History shows that there 
was a rush from the farms to mill towns and cities even when factory 
shifts were more than twelve hours long. The gregarious tendency is the 
foundation of our social system. 

Display is the instinctive desire to make a great show of oneself — 
demonstrated in a fashion show or parade. 

Shyness is the quality of being cautious, i.e., fearful of being the first 
to appear in a conspicuous costume. 

Imitation is the instinct to copy or make a likeness of something else. 
We imitate our leaders in clothing and copy the dress of others we admire. 

The instinct for cleanliness is evidenced by our desire to appear free 
from dirt, perspiration, etc. This instinct causes a desire for clean, 
neat clothing. 

Curiosity is the instinctive desire to know or to see. We desire to see 
the latest styles of clothing and to read news of fashions. This instinct 
causes us to want to see hidden and mysterious things. Common and 
everyday things do not arouse our interest. Hence jewelry and delicate 
trimmings are used to call attention to the artistic points of the body. 

Suggestibility is the tendency to believe readily, to agree without reflec¬ 
tion. Sales clerks and stylists easily influence our choice of clothing by 
means of suggestions. 

Religion represents an instinctive desire to worship. Out of this 
instinct follows, through ignorance, fear, and superstition a belief in the 
existence of demons. To overcome the fears associated with the supersti¬ 
tion, color and shapes of clothing were used to exclude them. Red, 
particularly, was thought to keep away the evil demon. Hence red has 
always been a prominent color in clothing. 

Love of the beautiful is a craving for artistic things — colors, lines, and 
forms as carried out in nature. 

In addition, out of the above instincts develop such selfish 
interests as (1) desire for wealth, and (2) desire for power or posi¬ 
tion, which have been responsible for our great industrial and 
business development. 

Acquired Traits. Characteristics and impulses of people that 
prompt our desires and needs have been considered as of two kinds : 
(a) innate and (6) acquired. The innate impulses are those that 
are born with us and appear at different periods of life — such 
as the impulse to play. As stated before these are sometimes 
called instincts. Those characteristics or impulses that we 


40 


ECONOMICS OF CLOTHING AND TEXTILES 


acquire during life, because of environment, are called acquired 
traits — sometimes called habits. In other words, the impulses 
that appear naturally are called instincts, and those we acquire by 
practice we call habit. Both instincts and habits may be physical 
or mental. These instincts and habits constitute the character¬ 
istics of human society and are called human nature. The quality 
or characteristics of classes of society depend in a large degree on 
how well these instincts and habits are developed and trained. 
The acquired traits or habits are quite as important as the instincts, 
for a community or society is considered high class if the acquired 
mental habits and traits are good, and the society is low grade or 
low class if the acquired traits are bad. In fact, civilization is 
above savagery because the people called civilized have acquired 
a great number of mental habits which the savage has not. 

Of course instincts have much to do with the formation of habit. 
Instincts predetermine in a general way the kind or quality of the 
habit. For instance, the instinct for distinction prompts us to 
try to dress better than others. 

It has been proved by Weissman, the sociologist, that acquired 
characteristics are not transmitted, which means that the changes 
that take place in an individual during his lifetime can not be 
transmitted to his offspring. 

Emotions. Each instinct or impulse, once aroused, gives a 
characteristic reaction of the mind, such as an excited feeling, 
which is called an emotion. For example, the first time a diamond 
ring was placed on the hand we probably received a distinct emo¬ 
tion of delight. Fear is an emotion aroused by any object or 
incident that recalls associations or previous experiences of an 
unpleasant nature. Feeling is the quality by which expression is 
given to the emotions. Thus feeling actuates the creative work of 
artists and poets, and should likewise actuate all designers and 
artists in the conception and execution of designs for textiles, 
clothing, and wearing apparel. 

The feelings associated with emotions may be either simple or 
complex, and of either a high or low nature. To illustrate : The 
feelings aroused by religious, moral, intellectual, or aesthetic 
emotions are usually considered to be admirable and of high 
character. Complex feelings of this higher type are often called 


PSYCHOLOGICAL BASIS OF CLOTHING 


41 


sentiments, as compared with the ordinary emotions of fear, etc. 
Sentiment is the life and soul of beautiful or artistic things. It 
can give an irresistible charm to the crudest image. It is a tender 
or an artistic attitude that includes a tendency to judge objects 
by their power to arouse feelings. 

The association of ideas is determined more by the condition 
of our feelings than by any resemblance or connection between 
the ideas themselves. Consequently our emotions play an impor¬ 
tant part in our actions and judgments. The emotions determine 
our association of ideas and accordingly our judgments and actions. 
Therefore, it is very important that our emotional nature should 
be carefully trained and should develop wholesomely and freely. 

Our mental make-up is such that we seek mental relaxation 
after the routine and long hours of uninterrupted concentration. 
In civilization, man has sought relaxation (change of mental 
clothing) through movies, theater, literature, music, travels, 
hermitage, and in some cases through dissipation, such as drink, 
drugs, revelries. These activities appeal more to the emotions 
than to the reason and thus offer relaxation. Through these media 
and others man has resolved away his cares and anxieties, as 
expressed by the wise sage: 

A little nonsense now and then 
Is relished by the wisest men. 

Out of this instinct of play or spirit of relaxation has come a 
demand for playgrounds in America and Europe, where people 
may go at all times of the year and relax. With the spirit of play 
and relaxation comes a desire for beautiful and suitable clothing 
to make people appear to advantage and happy. 

It is unfortunately true that here in America, largely because 
of our ideas of success and the premium we put on money making, 
there is, despite our unequaled facilities for education, altogether 
too little attention paid by parents and teachers to the develop¬ 
ment of emotional stability and control. The nervous and emo¬ 
tional side — the effective side — deserves training as well as the 
intellectual side, and for the good of the race it ought not to be 
left to chance. Too often it is so left, with unfortunate results. 
Many an adult fear or worry goes back to neglected training — 


42 


ECONOMICS OF CLOTHING AND TEXTILES 


fear of the dark, for instance, or fear of closed spaces or open 
spaces. 

Such weaknesses as dislikes, fears, or aversions may be elimi¬ 
nated by proper training and education. Thus a fear may exist 
because of an incident that recalls unpleasant associations or 
happenings. By connecting with the incident pleasant and suc¬ 
cessful associations, fear may be overcome. 

There are certain weaknesses of human nature, such as gambling, 
which are due to an unstable emotional character and, in this case, 
also the desire to gain money quickly and without much effort. 
This weakness is carried over into business and accounts for wild 
speculation and unsound business practices. 

The factors of emotions and feelings, such as confidence and 
fear, enter very largely into failure and success in business. 

The physiological condition of a person changes from day to 
day, and in even a well-balanced individual the emotions are 
constantly fluctuating. Nearly every one has his “bright” days 
and his “blue” days. Of course, in the temperamental or nervous 
type of person these fluctuations are more pronounced, and we see 
striking alternations of cheerfulness and sadness. In extreme 
nervous or temperamental types these fluctuations are exaggerated 
and are often called eccentricities. These types of individuals 
have great economic importance, for it is from them that our group 
of leaders in dress designs, artists, musicians, inventors, etc. are 
recruited. Often during these temperamental outbursts have 
been conceived the greatest achievements, designs and inventions. 
Therefore, these types should be carefully trained, encouraged, and 
given a sympathetic hearing at all times. Many a brilliant 
achievement has been stifled by an unkind word of the phlegmatic, 
matter-of-fact individual who lacks an appreciative point of view 
for the temperamental type of mind. Persons of this type usually 
reflect their personalities and temperamental streaks in their 
clothing, i.e., the wearing apparel of an artist or an opera singer. 

Business Cycle. The part that fashion and emotion play in 
our economic life can hardly be estimated. When silk is in fash¬ 
ion we long for silk, when cotton is the fashion we long for cotton, 
at another time wool, etc. Rapid changes in fashion and fads 
affect business: it is either prosperous or depressed. These 


PSYCHOLOGICAL BASIS OF CLOTHING 


43 


changes of good and bad in business are spoken of as business 
cycles. 

The business cycle has been regarded by many economists as 
a psychological rather than an economic phenomenon. The 
pleasure-pain principle has been applied to labor, exchange, con¬ 
sumption, and value. Errors of optimism and of pessimism are 
caused by waves of emotion which run through society from time 
to time. 

A mistake or error of optimism tends to grow throughout the 
community and through psychological relations leads to a crisis. 
Then the mistake or error dies and gives birth to an error of pes¬ 
simism that grows in psychological importance until it actually 
causes a shortage. Thus the psychological interpretations of busi¬ 
ness fluctuations must always supplement the economic interpre¬ 
tations. 

Cultural Development. We have observed before that human 
nature is practically the same so far as innate instincts and desires 
are concerned and that the elements of human nature are funda¬ 
mentally the same today that they were two thousand years ago. 
The differences between civilized people and the uncivilized are 
due to the development of the original instincts by observation, 
memory, curiosity, imagination, and reason, and to acquired traits, 
not to new or different instincts which they possess. 

If we make an analysis of human life we find that it is primarily 
a struggle to satisfy human wants — to secure clothing, food, 
shelter, etc. Thus we find all human beings, including the savage, 
have acquired a knowledge of the art of making clothing and some 
of its uses, the ability to use various weapons with which to de¬ 
fend themselves, and to prepare traps to obtain food. They have 
also developed some form of language. 

Some human beings, particularly those living in the north 
temperate zone, have made greater progress in living than those 
living in other parts of the world. The differences in climate and 
physical resources have been the cause of the development of racial 
differences and also in the pace at which civilization has advanced. 
With this background of habit and instinct we can interpret the 
cultural contributions made by different nations at different 
periods. The minds of the ancient peoples differed from the 


44 


ECONOMICS OF CLOTHING AND TEXTILES 


medieval and modern minds, because of the difference in their 
acquired contents. 

Since acquired traits are not inherited, children tend to accept 
the habits and characteristics of their cultural environment. To 
illustrate: A child born of civilized parents, placed at birth in the 
African jungle and reared by savages, would to a large degree 
wear the same clothing, acquire the habits and traits of the savage, 
and would desire to remain in the jungle when he reached man¬ 
hood. We observe today in our rural and industrial centers that 
children react in a similar manner and tend to acquire the physical 
and mental traits and habits of their parents and the group popu¬ 
lation in taste and use of wearing apparel with which they come 
in contact. 

Classes in the same community appear differently in clothing 
and style because they have acquired different habits. The poor 
may have developed in an environment that tends to produce a 
feeling of inferiority, carelessness in dress, and no appreciation 
of fine clothing; they live squalidly and lack an appreciation of 
the finer or artistic things of life. In contrast to this group, young 
people that develop in association with wealth and culture and 
appreciation of fine taste and wearing apparel usually tend to 
develop an ability to evaluate and appreciate these things. 

To satisfy the tastes and demands of all the people, wearing 
apparel may be divided into at least four style classes, according 
to the demands of various groups: (a) conservative, ( b ) popular, 
(c) ultra-stylish, ( d ) exclusive. To illustrate : A serge costume is 
composed of a staple fabric, and is always in style, hence it may 
be considered conservative and adapted to business or street wear. 

It is only after the necessities, such as food, clothing, and shelter, 
have been acquired, that mankind attempts to satisfy other 
longings and desires, such as a desire for beautiful things, for music, 
companionship, and the higher social relations. 

Of course this desire for the beautiful may be crude in the 
beginning, but by training it is possible to develop a very high 
appreciation and discrimination, as well as a desire to own and 
create beautiful things. This is particularly true with regard 
to things we associate closely with ourselves, such as clothing. 
Nature — our natural surroundings — suggests beautiful colors, 


PSYCHOLOGICAL BASIS OF CLOTHING 


45 


lines, and form combinations that can be utilized. Hence we find 
people that are located at different geographical points differing 
in the coloring and form of their clothing because their surround¬ 
ings in nature are different. 

As stated before, our appreciation of the beautiful depends 
largely on our cultural environment. In order to appreciate the 
beautiful forms of clothing it is necessary to teach our minds to 
see the fine distinctions. As is true of everything else in the 
world, there are two ways of enjoying a work of art (of wearing 
apparel, etc.): (1) with or (2) without understanding. We have, 
in every generation, emotionalists who enjoy and judge a costume 
or a piece of sculpture by the amount of emotion it rouses in them. 
This approach, as a beginning, is admirable. To be sure, it is 
haphazard, arbitrary and, according to biologists, unfair. Never¬ 
theless, an emotional approach to art is, because it is often intuitive, 
an excellent thing. 

But there is more in a work of art or in a costume than the 
emotions alone can comprehend. Every work of art is related 
to art history. In other words, it is related to and influenced by 
other works of art. Only as we study and know these relationships 
and influences can we perceive and enjoy intelligently the indi¬ 
vidual contribution of this or that artist and what he himself has 
to say. Only by developing our power to analyze, compare, and 
form conclusions about wearing apparel can we learn to exercise 
sound judgment about clothing and its artistic value. 

Art in dress demands that the costume be planned so that it 
will meet certain aesthetic requirements known as the principles 
of design. In addition the costume must meet the standards for 
modesty, health, and economy. 

Art of Clothing. Out of the craving for beauty and the impulse 
or desire to express ourselves or to create have come the fine arts —• 
architecture, landscape gardening, music, painting, drama, the art 
of costume and of beautiful clothes, including jewelry, embroidery, 
and fine needlework. Society encourages the development of the 
fine as well as the useful arts because they contribute to human 
happiness and welfare by satisfying other than material needs. 

Probably the instinctive desire for decoration and the beautiful 
finds its greatest outlet in clothing and home furnishings. The 


46 


ECONOMICS OF CLOTHING AND TEXTILES 


designing and construction of a garment and the choosing and 
assembling of a costume which is to be worn are each a form of 
creative expression indulged in by most persons. 

Adornment of the body is practiced in three distinct ways: 
(1) All classes from the primitive tribes to modern society attempt 
to mold the body to certain local standards of beauty, such as 
head deformation, foot compression, and waist and bust compres¬ 
sion or expansion as practiced at various times. These forms of 
deformation emphasize some natural physical characteristic of 
the people who practice them. (2) Another form of adornment 
is the application of coloring or other substances to -.the body, such 
as painting and tatooing. (3) The suspension of attachments to 
convenient portions of the body represents the commonest method 
of adornment and includes the ear, nose, and lip ornaments, head 
dresses, armlets, girdles, wristlets, leglets, anklets, and finger and 
toe rings. 

Modesty. The feeling of modesty is not instinctive, but is 
rather a conventional form that differs with various religious 
beliefs and races of people. Evidence shows that it is a feeling 
of acute self-consciousness caused by appearing in unusual clothing, 
and that the feeling of shame is due to the mental condition caused 
by the change, abbreviation, or absence of accustomed clothing. 
To illustrate the varied ideas of modesty: The Mohammedans 
feel that a woman is immodest if her face is uncovered, regardless 
of how fully she is clothed otherwise. The Chinese feel that it is 
indecent for a woman to show her compressed feet. Various wild 
tribes feel that a woman who is tattooed is decently clothed. In 
African tribes the men are more elaborately clothed than the 
women. Explorers report that savages who are accustomed to 
go with little clothing have a feeling of confusion when they are 
asked to become fully dressed according to European standards. 

Style of Theatrical Costumes. The selection of proper clothing 
for stage and movie is a more serious problem than dressing for an 
ordinary event or party. The effect of clothing worn on the stage 
and in the movies must be more psychological than ordinary 
tailored or costumed apparel. In other words, a costume before 
the footlights or movies must be something more than a costume: 
it becomes a tool to be skillfully used by the actress to aid her in 


PSYCHOLOGICAL BASIS OF CLOTHING 


47 


conveying the personality, traits, and moods of the person whom 
she is portraying before the audience. 

The clothes the actress wears make first contact with her audi¬ 
ence, and for that reason are important. They can establish her 
as chic, dowdy, rich, poor, sympathetic, gay, or scheming. When 
you see an actress appear in a red velvet cloak you know that she 
is in a gay and dangerous mood before she even opens her mouth. 
When an actress changes from the costume of a lusty cabaret singer 
in the first act into a dull blue tea gown, you know at once that 
a change has taken place in her character. 

Religious Influences. The clothing worn by people at different 
periods has been determined more or less by social, religious, 
economic, political, and geographic influences. The instincts of 
all classes, even the slaves and serfs, have influenced them to appear 
attractive to their friends. Also, the love of distinction has 
developed a sense of rivalry which has been the compelling and 
moving force that causes styles to change. Religion has influenced 
many forms of clothing and wearing apparel, and has caused, 
among others, the distinctive garb of sackcloth. 

The clothing worn by churchmen in various services is of ancient 
origin and has symbolic meaning. Most religions discourage 
interest in dress, and religious leaders frequently use the pulpit 
as a means of condemning fashions of the day. 

Sackcloth is penitential fabric. The ancients, more particularly 
the Hebrews and Assyrians, during the period of great affliction 
laid aside the garments best suited to their ease and comfort and 
put on sackcloth, which was woven of the coarse, short hair of 
animals, twisted together and used for both warp and weft; this 
coarse, prickly material was made into garments which fit close like 
a sack, without trimming or other adornment, and were worn 
solely to inflict personal discomfort in cases of grief or penance. 

The Egyptians believed in the immortality of the soul and they 
searched for a fabric that would express this belief — linen. 

Emotional Appeal of Cloth. Since clothing is intended to add 
to our attractiveness, it is only natural that man should choose the 
designs of the best in nature — flowers, animals, stones, etc. The 
environment has modified feelings and tastes in matter of decora¬ 
tion. Thus we find the more brilliant colors near the equator and 


48 


ECONOMICS OF CLOTHING AND TEXTILES 


the more subdued ones as we approach the north. Tastes and 
standards in clothing vary as widely as do our social and physical 
backgrounds. Individual fabrics and styles of clothing are so 
varied that almost any mood or personality may be emphasized by 
the proper choice of garments. 

European countries stand very strongly for local interests, 
which cause local styles and also individual styles. The result of 
this local feeling has been a resentment against mass production, 
mass designing, and mass styling. Americans, on the other hand, 
because of mass production and mass designing, have attempted 
to standardize everything, even style models, as much as possible. 

Due to the strong feeling of democracy in America, there has 
grown up a feeling of democracy or sameness in dress, so as to 
eliminate social distinction. The fear of being ridiculed and called 
undemocratic and a “snob” has prevented men from displaying 
individuality in dress. 

Style Inspiration. For centuries Paris has been the style center 
of wearing apparel for women and London the style center for 
men’s clothing. The best known style creators for women’s 
clothes are found in Paris. These persons are truly creative artists. 
While they must conform somewhat to fashion in order to sell 
their dresses, one finds artistic touches, lines of design, and distinc¬ 
tive treatments characteristic of each designer. Some really 
launch a new fashion. 

They hold openings or exhibitions of new models to which their 
patrons, press agents, and certain buyers are invited. Here 
several hundred models may be displayed, and of these only a 
few prove successful. These become the fashions of the season. 

The keynote of the new style is usually influenced by some 
passing event, such as the war of the Balkans, the French colonial 
exhibition, the centenary of George Washington, the nudists’ 
movement, etc. 

Resort Fashions. There are resorts that wealthy people fre¬ 
quent in winter, spring, summer, and fall to spend their leisure 
time. It is at these places that one finds the best dressed men and 
women. Since these resorts are found in different parts of the 
world, the climate varies from extreme heat to cold at the same 
season, from Palm Beach, Florida, Hot Springs, Virginia, to the 


PSYCHOLOGICAL BASIS OF CLOTHING 


49 


winter sports at Lake Placid and Canada. The fashions during 
January in Palm Beach forecast these at Bar Harbor, Maine, in 
July. So that the fashions appearing at one place forecast those 
that are to appear later in the year at other resorts with the same 
climatic conditions and temperature. 

Dress manufacturers and designers use the resorts of the differ¬ 
ent countries as “try-out places’’ for their model costumes. All 
the great original designers, called couturiers, send their new 
models to these resorts, where the creations are worn on living 
models, called manikins. Since these resorts differ in location, 
temperature, and surroundings, it is necessary to know these 
differences in order to be able to choose the styles that are appro¬ 
priate and also to know how to interpret the reactions, so that the 
costume styles that are popular may be adapted to new locations. 

The fashion centers for the display of new creations are found 
to best advantage in the playgrounds — race tracks, health resorts, 
beaches, winter sport centers, fall and spring country resorts, etc. 
These places may be classified according to location into the 
following groups: (a) European, (6) English, (c) Scotch hunt¬ 
ing centers, ( d ) African hunting centers, (e) American southern 
winter resorts, (/) American and Canadian northern winter re¬ 
sorts, ( g ) American western resorts, ( h ) American golf resorts, 
(i) American summer resorts. The styles of great designers or 
couturiers like Worth, Lanvin, Paquin, Jenny, Vionnet, Patou, 
Poiret, etc., appear at all such pleasure resorts. 

Fashion and Wealth. The nobility first introduced the idea 
of fashion. The poorer people felt it was sinful to have changes 
in clothing, and in fact it was not within their power to have such 
changes. The wealthy people attempted to imitate the nobility, 
which caused the latter to make a change in the style of their 
clothing as soon as the wealthy were able to have the prevailing 
style copied. 

At different periods in history, and in different countries, we 
find different conceptions of the style of dress appropriate to 
reflect the wealth of the individual. In ancient Greece the work 
was done by slaves, and the freemen wore flowing costumes that 
were unsuitable for working conditions. Later, when the men 
were obliged to toil, the costume changed from flowing to close 


50 


ECONOMICS OF CLOTHING AND TEXTILES 


fitting. The oriental conception of wealth was expressed in dis¬ 
playing a large amount of jewelry on the wife. The Chinese 
favored small feet and long finger nails for women because they 
retarded the ability to work. Such evidences of wealth gave 
distinct social standing. 

There is a strong feeling, particularly among the working classes 
of women, that the chief pleasure of life is that obtained from 
wearing apparel. This is shown by the behavior of the working 
girl, who insists on wearing party dresses to work. This is caused 
by the desire for the respect of their fellow workers and is also a 
psychological reaction to the menial feeling incident to working 
about machinery. The love of distinction exhibited in wearing 
apparel is really an appeal for the approval of people of one’s own 
standing and of those beneath us, but never of those above. 

Variety in Styles. The difference in style effects requires the 
making of many types of fabrics, because not only the color but 
also the cut and line effects depend upon the characteristics of 
the fabric. To illustrate: A stiff silk fabric like taffeta gives a 
bouffant effect while crepe de chine will give a soft, clinging effect. 
Chiffon, a light, sheer silk fabric that lacks body and stiffness, 
may be used as an overslip. 

To satisfy human desires, clothing and costumes have been 
devised for all kinds of uses and occasions : (a) walking, ( b ) riding, 
(c) tennis, (d) golf, (e) street, (/) informal, ( g ) formal, ( h ) leisure. 

Fashion has rapidly developed in all forms of wearing apparel 
since the advent of modern machinery. Clothing is cheaper 
today than at any other period. A generation ago clothing was 
proportionally more expensive, hence changes in fashion were not 
as common as they are today. 

The use of gloves was years ago restricted to the nobility and 
the well-to-do. Gloves were considered a distinct luxury, the 
trade was not extensive, the prices were high, and the decorative 
elaboration caused additional charges and a higher price. 

We must remember that clothing has two elements, (a) practical 
use, and ( b ) luxury. Frequent changes of fashion emphasize the 
luxury and not the practical use of clothing. 

Widespread Knowledge of Style. News concerning changes in 
style passes quickly from one group to another by various modern 


PSYCHOLOGICAL BASIS OF CLOTHING 


51 


channels of communication — the telephone, the telegraph, the 
newspapers, the magazines, the radio, television, and the cinema. 
Today the same fashion is in vogue all over the country, so that 
people in remote districts are well informed regarding the latest 
changes in style. This eliminates embarrassment, the feeling of 
strangeness and inferiority, caused by being dressed differently 
from others. It tends to bring about a more democratic nation, 
because if we dress alike we are less apt to have geographical and 
class distinctions. 

Effects of Emotion. The spirit of depression is “catching,” 
like an infectious or contagious disease. Morale at all times is 
almost as much of a problem in a large organization as it is in an 
army. It is notorious that it is hard to maintain morale in a 
period of deflation, when men have to be discharged, wages have 
to be cut, and retrenchments have to be made. Here, for instance, 
you have a salesman, full of enthusiasm, “going strong.” But 
one day he has a heart-to-heart talk with another salesman whom 
he has always envied and gets the impression that anything may 
happen to his job and his pay. He goes home and tells his wife, 
and she is thrown into anxiety. Worse yet, from that time on 
he is full of suspicion, and instead of concentrating on his job, 
spends half his time watching the other fellow and listening to 
and passing rumors, until finally he is practically useless. The 
officials are unable to stifle the spread of the depression. In fact 
it gradually goes through the whole force of officials. During 
this time both men and women lose interest in their personal 
appearance and no wearing apparel is purchased. This in turn 
cripples the whole industry. 

A panic usually precedes a depression and is due to psychological 
reasons when a few people have lost confidence on account of 
false or true rumors, and the fear element causes one to become 
selfish enough to withdraw his share of capital, regardless of the 
interests of society in general. 

A state of mind, business executives agree, is the most real 
thing in this world, except the necessities of life and money with 
which to buy them. All organizations — families, corporations, 
even governments — are what men, with their individual state of 
mind, make them. In other words, no matter what Luck and 


52 


ECONOMICS OF CLOTHING AND TEXTILES 


Prosperity ordain them to be, all organizations are, for better or 
worse, the sum total state of mind of the individuals of which 
they are composed — on the side of morale, at any rate. 

Each individual is the hub of his own universe, and the victim, 
for better or worse, of his own mood — a depression or a boom 
in himself, more or less. Therefore, though most Americans 
look upon nationwide depression as a condition remote in cause 
but not in result, actually, in one sense, it is the state of mind of 
any typical American multiplied by 120,000,000 or so. 

Therefore the emotions should be carefully developed so as to 
appreciate in the highest degree the different kinds, qualities, and 
values of wearing apparel. On the other hand our emotions 
should be controlled so as not to allow them to disturb our happi¬ 
ness, business relations, etc. 

Serious Results of Change. A sudden style change may cause 
economic disturbance among established industries. For example, 
the weight of wearing apparel of both men and women, particu¬ 
larly women, has decreased since medical science has decided that 
the human body should be exposed as far as possible to the circula¬ 
tion of air and sun rays. The reduction of weight has caused the 
consumption of wool and cotton to decrease, and naturally affected 
the running capacity of textile mills. 

Then again, changes in the composition of clothing, especially 
women’s, from silk to tweed or furs, and from cotton to silk, etc., 
have affected the running and production of the mills. Each 
mill is laid out to make clothes of one composition and often of one 
weave, and any change means curtailment of the mill. 

The cutting of long hair on the part of women affected not only 
the ribbon industry, but also the ostrich industry that had supplied 
feathers for ornaments. 

The fad of going without hats has stunted the cap industry. 

Age in Clothing. Just as we have clothing adapted to various 
occasions, we also have it adapted to the physical and mental 
characteristics of different ages, from children to old men and 
women. It is important to know the characteristics of the various 
age groups. 

Life may be divided into the following periods: infancy, from 
birth to six years; childhood, from six to twelve years; adoles- 


PSYCHOLOGICAL BASIS OF CLOTHING 


53 


cence, from twelve to sixteen; sixteen to eighteen; eighteen to 
twenty-four; adult; old age. The period of infancy is the time 
of greatest activity, when the child appears to consist largely of 
a bundle of instincts, such as locomotion, curiosity, grasping, etc. 
Therefore the clothing should be loose and free in order not to 
curb these activities. 

At the age of five or six a child is able to walk with ease and 
grace, but the precision of the movements of hands and fingers is 
about three-fifths that of a boy of sixteen years of age. The 
clothing should still be adapted for activity and self-development. 



The second period, childhood, is marked by less violent and 
more directed self-activity. The most active instinct is the play 
instinct. It is both expression and means of education. Hence 
clothing at this period should be adapted for play purposes, and 
should be strong and washable. 

Growth during the period from ten to twelve is slow, and a 
surplus of energy is available. It is the time when the play 
instinct is strongest and a period for the development of facility 
and skill, when drill exercises for the formation of habits may be 
given with least harm. It is the time when boys like to form 
groups and organized clubs. 

From fourteen to sixteen is known as the “clumsy age,” when 
the bones grow faster than the muscles. Some children during 
this period develop awkwardness, periodic laziness with a tendency 
to self-assertion, and dreams of greatness. 

At sixteen years of age children begin to take an interest in 
wearing apparel and attempt to dress to appear to advantage. 





54 


ECONOMICS OF CLOTHING AND TEXTILES 


From eighteen to twenty they long for the extremes in fashion and 
seek new clothing in latest designs and colors. Note the wearing 
apparel of college freshmen. Above twenty they assume a more 
conservative but nevertheless strong interest in wearing apparel. 



School Dresses 


As we grow older and approach the marriage state our wants of 
clothing become very elaborate and numerous — clothing for all 
occasions — business, club, sports, formal, semi-formal, and all 
forms of leisure clothing. 

As people approach forty they become more conservative in 
their dress and their wants are fewer. This continues to old age 
when the desires are limited and very conservative. 

QUESTIONS 

1. Why is the psychological basis of clothing important? 

2. Explain briefly the workings of the mind in the purchase of wearing 
apparel. 

3 . (a) What are the three functions of the mind? (6) Explain in 
detail the purpose of each function. 

4 . Define briefly: (a) logic, (b ) rational person, (c) immediate organ 
of the mind, ( d ) senses. 

5 . Why are the senses of touch and sight important in the appreciation 
of wearing apparel? 

6 . Describe briefly the cause of after-images and their importance in 
dress. 

7 . Describe the importance of appreciation of the proper (a) color, 
( b) line, (c) luster in wearing apparel. 









PSYCHOLOGICAL BASIS OF CLOTHING 


55 


8. State how the appreciation or education of the value of dress may 
be acquired. 

9. Explain personality and other important factors in selecting the 
proper wearing apparel. 

10. What is meant by (a) instinct, ( b ) habit, (c) skill or technique? 

11. Describe briefly how we acquire our knowledge of clothing. 

12. Why is psychology important in advertising? 

13. Define ( a ) knowledge, ( b ) observation, (c) experience, ( d ) attention, 

. (e) memory, (/) association of ideas, ( g ) interest. 

14. How are ideas relating to wearing apparel best remembered? 

15. What is judgment? How is it obtained? Explain in terms of 
wearing apparel. 

16. Define briefly: (a) reasoning, ( b ) knowledge, (c) information, 
(d) motive, (e) idea, (/) belief. 

17. What are the steps necessary to secure a response for an advertise¬ 
ment? 

18. What is meant by the expression “power of suggestion”? Why is 
it important in wearing apparel? 

19. What is meant by the expression “original ideas”? Have we 
original ideas ? 

20. What is the difference between an instinct and emotion? Explain 
in terms of wearing apparel. 

21. What is the difference between feelings and sentiments? Explain 
in terms of wearing apparel. 

22. Explain the meaning of fear and how it may be overcome. 

23. Explain how our psychological reactions affect the business of 
making wearing apparel. 

24. Has any change taken place in our instincts during the history 
of the human race? 

25. Are our instincts the same as those of the savage? 

26. Explain the meaning of supply and demand from a psychological 
point of view. 

27. Explain from a psychological point of view the morale of a textile 
mill employee. 

28. Describe from the psychological point of view the impulse or 
desire for beautiful clothing and of appearing to advantage. 

29. Why is clothing worn? 

30. Why has clothing been worn in different ways by different people 
and in different civilizations? 

31. Why are different types of clothing worn? 

32. Why are different costumes worn by the sexes at different periods 
of life? 



56 ECONOMICS OF CLOTHING AND TEXTILES 

33. Show how the religions have influenced the costumes of different 
people. 

34. Enumerate the different classes of people. 

35. In reality, what are so-called “ original” designs? 

36. Why is it hard to protect designers by law, as authors and inventors 
are protected ? 

37. What instincts are played upon by the textile merchant to increase 
sales? Which is the strongest? 

38. What is the psychological reason for jewelry ? 

39. What danger to the consumer lurks in attractive advertising? 

40. How does a general lack of confidence on the part of the buying 
public affect business? 

41. What is the appeal of the following materials: velvet, georgette, 
satin, lace, metal cloth, fur, linen? 

42. How does the concept of modesty differ in various races? 

43. In what three ways is the adornment of the body practiced? 

44. Explain the six silhouettes from which stylists may evolve a fashion¬ 
able mode of dress. 

45. Describe the mode of dress for each of the “stages of man.” 

46. What is the history of the veil as an article of clothing? 

47. Distinguish between a “tough mind” and a “tender mind.” 


CHAPTER III 


SOCIOLOGICAL BASIS OF CLOTHING 

Importance. In the previous chapter we discussed the psycho¬ 
logical basis of clothing, and saw also that the workings of the mind 
are very closely related to, in fact are governed by, the social forces 
of which we are a part. Sociology is the science that explains the 
mechanism and behavior of society. Since economic progress is 
any change in the condition of individuals or members of society 
that tends to increase their welfare and their happiness, we can 
readily see the close relationship between the sociological, psycho¬ 
logical, and economic factors of existence. We might say that 
economics is related to psychology and sociology because they 
provide the aims, hopes, aspirations, and standards toward which 
economics should tend. 

Economics of clothing refers not only to the clothing of a single 
individual but also to that of his friends and neighbors as well. 
Hence its point of view is social and not individual. Society is a 
term we use to refer to any group of individuals or families com¬ 
posing a community within which exists a certain aquaintance, 
similarity, or common interest. The activities of members of such 
groups are called social activities and form the bonds or ties that 
prompt us to live together, work together, etc. — in other words, 
to cooperate. The more bonds or links that bind a society together, 
the more cooperation is experienced and the greater the happiness, 
wealth, and union. 

Social Science. The economics of clothing has been defined as 
a study of the best experiences and efforts of the race in regard to 
the manufacturing, buying and selling, and consumption of cloth¬ 
ing. It follows naturally that economic thought about clothing 
will change more or less with the social changes and conceptions 
of the people. The psychological reactions of the human race are 
influenced by sociological changes and in turn influence economic 

57 


58 


ECONOMICS OF CLOTHING AND TEXTILES 


theory. Since social conceptions and organization have changed 
widely from the time of the freedmen and slaves of the Greeks and 
Romans, to the period of serfs in the Middle Ages, and thence to 
the wage-earners of the factory system and the distinct cooperative 
system of industry under democracy, it is only natural that many 
of the old principles of economics are questioned in the light of 
modern business and social conditions. 

It is easy to show by illustrations that economics is not a finished 
but a growing science and that economic thought is constantly 
changing in response to the sociological and psychological condi¬ 
tions of the people. Economists have been criticized because they 
did not predict the coming of the 1929-33 depression during the 
boom years, at least with any degree of definiteness. On the 
contrary a large number had created a false sense of security by 
pointing to the existence of a “ new era,” in which weaknesses in 
the economic structure that were known to breed depressions had 
been in the main eliminated. Economists have lost caste even 
more by their persistent inability to furnish effective leadership 
in pointing out a definite course of action that would halt the 
disastrous decline in prices and recession in business activity, and 
thus pave the way for the desired recovery. 

Economics is generally regarded as having reached the stage of 
a “ science ” — by those willing to concede it this designation — 
more than a hundred years ago with the appearance of the work 
of the English classical writers. Since then a substantial and 
steadily growing number of writers and teachers have been con¬ 
cerned with economic questions and have collectively received the 
designation “ economists.” 

There is, first, a group concerned with what is called “ pure 
theory,” deeply involved in drawing conclusions from simple and 
artificial premises by the application of logical or mathematical 
methods. Their work in the main has no more relation to the 
actual and pressing business problems of today than the activity 
of students of medieval scholasticism. 

A second group of economists is concerned with the problem of 
forecasting future trends in business or finance, chiefly on the 
basis of statistical data. The idea of a “ new era ” was sponsored 
in the main by economists belonging within this category. 


SOCIOLOGICAL BASIS OF CLOTHING 


59 


In the third place, there are a number of workers in the field, 
probably a large majority at the present time, who are concerned 
with the study and analysis of particular business problems, such 
as banking, the anti-trust laws, tariffs, marketing, etc. Such 
particular studies have brought about an enormous advance in 
the degree of understanding of the business mechanism which now 
exists. The analysis of many of these problems is still in its in¬ 
fancy, although steady progress is being made in many directions. 
Each recurring depression tends to puncture fallacies and mis¬ 
understandings that arise in the study of these problems, as cold 
facts teach new lessons. 

The study of specific business problems of a single industry, 
such as wearing apparel, presents at the present time the brightest 
and most promising development in economics. Criticism of 
economists as a group because they did not predict the depression 
or show the way to end it may be justified, but there is no reason 
to despair as long as new lessons are learned and the knowledge 
of economic processes is expanded. Such simple truths as the 
contention that war debts and reparations constitute insurmount¬ 
able barriers to the revival of trade and the international readjust¬ 
ment of prices, or that more effective methods of credit control 
are needed to prevent a repetition of speculative booms in the 
security markets, have obtained general adherence at the present 
time. It is reassuring that these views were taken years ago by 
several students of these problems who at the time received scant 
attention from the public at large. Thus we see that economic 
thought is still somewhat in advance of business practice and 
generally accepted ideas. 

Men’s actions are governed, ultimately, by their beliefs. A 
completely false belief, once established in the mind, is just as 
powerful a spring of action as one based upon eternal truth. 
Beliefs held in common by a large number of individuals become 
social forces in the strictest sense. They govern social action, 
determine social forms and institutions, and direct the course of 
social change. 

Opposing Theories. Two of the most fundamental theories re¬ 
garding our industrial system are the laissez-faire and the paternal¬ 
istic theories. These theories are based upon the assumption that 


60 


ECONOMICS OF CLOTHING AND TEXTILES 


what is good for the individual is necessarily good for the group, 
that a line of conduct which will promote personal welfare will 
also promote social welfare. While these theories may be true 
with a right-minded or conscientious person, they are not always 
true with all people. 

The principle of every man for himself is as dangerous and fal¬ 
lacious in the economic and social realm as it is in clearing a theater 
during a fire. In the latter case it is to the immediate interest 
of the individual to run to the nearest exit. If he does so, however, 
and all others do likewise, there is a panic, exits are blocked, and 
hundreds die from suffocation, smoke, and fire. 

The old theory of economics held that the chief cause of unem¬ 
ployment lay in the fact that most unemployed persons were either 
sick or “ unfortunate.” But calm statistical analysis shows that 
such inefficient persons make up only a small portion of the un¬ 
employed. Far more are out of work because of seasonal industry, 
technological advances, cycles of business, and the like — all 
strictly social causes which the individual can not control unaided. 

Conventional remedies for unemployment are equally short¬ 
sighted. “ Let the sick get well and the bums cease their shift¬ 
lessness.” If they did they would only constitute so much more 
effective competition with the well and ambitious person out of 
work. “ Let persons learn two trades so that they can dovetail 
them and adjust themselves to seasonal changes — work on both 
flowers and furs.” But every person who does so drives out of 
employment a flower- or fur-worker. 

Look at immigration policies that have prevailed in the last 
half century. People left Europe for America. It was expected 
that this would produce a double benefit. The emigrants would 
greatly improve their condition in the United States. By leaving 
Europe they would reduce the population pressure at home and 
allow standards of living to rise for those left behind. Actually, 
the excessive immigration to the United States has lowered our 
standards of living, reduced wages, and increased unemployment. 
Further, the gaps in Europe were quickly filled by an increase in 
population, leaving matters there as bad as ever. Some individuals 
profited by immigration, but Western society, as a whole has been 
gravely injured, particularly during the latter part of that movement. 


SOCIOLOGICAL BASIS OF CLOTHING 


61 


Perhaps the worst illusion of recent years is that of cutting 
wages to end depression. The only way out of the depression 
under capitalism is increased buying power and activity. This 
must come chiefly from the wage-earners. Cutting their income 
simply prolongs the slump. The readiness with which employers 
resort to this expedient of lowering wages whenever hard times 
threaten is precisely one of the reasons why depressions gain head¬ 
way so rapidly and last so long. 

The tariff has been a respectable dogma for a century. Yet 
all that should be needed to uproot it is the simple truism that in 
the long run one can not sell unless he is willing and able to buy. 
So with stock speculation. When security prices are skyrocketing 
and out of all relation to capital investment and earning power, 
the only way the individual can profit is by selling his securities. 
But if all do so, then we have a crash like that of October, 1929. 
Further, consider installment buying. It may benefit the indi¬ 
vidual, but the industrial and commercial future of society is 
sadly handicapped when families have all their resources and 
future income applied to the payment of goods already consumed 
or being consumed. 

In every case we find that the economic problem involved is 
social rather than individual, and that many existing ideas about 
economic matters will have to be modified to a more social inter¬ 
pretation of human life. 

Man a Social Being. Human beings, even the savages, are 
naturally companionable to their neighbors. They exhibit very 
prominently characteristics that allow them to have their plea¬ 
sures, benefits, happiness, duties, and interests together. These 
qualities, characteristics, instincts, or traits are the ones which 
bring people together to form society. Out of these traits or 
characteristics develops a feeling of “ getting together ” on larger 
and permanent interests, which we call cooperation. The primary 
cooperative agency that has arisen in all grades of civilization is 
the one in response to the desire to reproduce one’s own kind, — 
that is, the family, — and out of this has grown the home. Al¬ 
though not so strong as the instinct of reproduction, the religious 
trait, the desire to pay homage to his Maker, has encouraged 
cooperative action. Another social activity developed only in 


62 ECONOMICS OF CLOTHING AND TEXTILES 

human beings of higher civilization is that of protection, out of 
which has grown the public safety department. The economic 
trait has lead to cooperative development of industry and com¬ 
merce. These great characteristics are very important and are 
the basis of community and industrial life, of which clothing and 
wearing apparel form a foundation stone. 

Dress a Social Force. Members of society soon realized that 
the spirit of cooperation and community or tribal life required 
that every one be as attractively dressed as possible in order to 
appear to advantage and to win the respect of others. Leaders 
of the various social groups began to formulate a manner of dress 
that would appeal to their followers and be based upon religious 
and geographical conditions. The dress of the leader would 
naturally be more attractive and more expensive than that of the 
followers in order to satisfy the desire for superiority and love of 
distinction. To illustrate: The nobility of China developed silk 
costumes, of which they kept the secret of production for centuries. 
The Egyptians used linens, because of their lasting qualities, and 
thus expressed their religious idea of the immortality of the soul. 
Purple, from an expensive and rare coloring fluid, obtained in small 
quantities from a species of fish, was the coloring used for decora¬ 
tion, and has remained so until the present time — royal purple. 
The cut and design of the costume for the nobility was expected 
to be elaborate in order to show that it was not adapted for manual 
work. The flowing costume of the Greeks illustrates this develop¬ 
ment. The time required to make costumes by hand was so great 
as to preclude frequent changes of clothing. 

The clothing customs and habits that developed in individual 
countries and civilizations were gradually modified by the desires 
of the nobility or leaders, and by changing religious and industrial 
conditions. Usually distinctive forms of dress, in color and in 
trimmings, were adopted for the nobility and the freemen. The 
slaves and serfs used the clothing repaired and also cast-off clothing 
from their masters that had been remodeled to their needs. 

As we glance over the history of civilization, we note that the 
work was done by slaves in the time of Greece; by serfs, who were 
half slaves, during the feudal times; and by the factory workers 
during the factory stage. Because the wearing apparel worn by 


SOCIOLOGICAL BASIS OF CLOTHING 


63 


slaves and serfs was scanty and poor in quality, it gave rise to 
the feeling that work meant meager clothing. Even up to the last 
generation or so, factory workers and mechanics wore clothing in 
the form of rags, because of age and wear. Bosses, designers, etc., 
frequently went to work with silk hats and canes. The nobility, 
the professional class, and the scholars wore elaborate clothing in 
bright colors; for instance, note the colors of costumes worn by 
holders of academic and professional degrees. Today we refer to 
members of the “ white collar ” working class to distinguish them 
from those who toil on machines and with tools. 

Custom and tradition have established certain clothing styles 
that seem to resist any movement toward a change. To illustrate : 
Note the costumes worn at the church services, court costumes, 
the costumes of judges and lawyers in England, gowns worn at 
college exercises, wedding costumes, etc. 

Under the old aristocratic forms of government, fashions of wear¬ 
ing apparel seldom changed. Laws were passed preventing mem¬ 
bers of the lower classes from copying the costumes of the classes 
above them. The poorer people in their ignorance and isolation 
became alarmed at new ideas in clothing and naturally clung to 
their national costumes featuring needle work and color. 

In eastern countries, where the religious and social conditions 
are very strict, and the temperature is very constant, the styles 
of clothing are fairly constant. 

The desire of the freemen and wealthy citizens to imitate the 
dress of the nobility caused the establishment in early ages of laws 
forbidding people to wear certain forms of wearing apparel. To 
illustrate: 

(a) The use of the color purple was restricted to the nobility 
among the Greeks and Romans. 

( b ) The Roman law at first forbade the use of silk for men. 

(c) During the Middle Ages kings frequently designated the 
kind of wearing apparel for the nobility. 

History shows us that even during later periods the economic 
life of communities, including the type of wearing apparel, has been 
dominated in a more or less direct manner by such factors as : 

(1) Religious ideals and church organizations, (2) political 
aims of statesmen and party politics, (3) class prejudices and 


64 


ECONOMICS OF CLOTHING AND TEXTILES 


social conventions, (4) changes in industrial policy, (5) changes 
in taste and fashion, etc. 

In some countries certain types of clothing and accessories are 
absolutely necessary, while in other countries they are not required 
or used. Take the fan for example. In Japan, the fan is as uni¬ 
versal as a garment, constituting as truly as any other clothing 
accessory one of the necessities of life. It is at all seasons an 
inseparable part of the Japanese dress. It is a shelter from the 
sun, a protection from the rain, a note-book, and a plaything. In 
America a fan is an accessory that comes and goes with fashion. 

The changes in the use of the ordinary handkerchief illustrate 
a similar modification because of changing conditions. At first 
the handkerchief was a bit of silk tissue fabric used centuries ago 
by priests at the altar. For many years, indeed, priests were the 
only persons in the European world allowed the privilege of using 
handkerchiefs at all, and they used them only at the altar for the 
sake of propriety. It was then called a “ facial,” and was left 
with the other vestments of worship when the service was done. 
Presently the grand ladies of the court began to provide them¬ 
selves with similar squares of silk. The next step was to embroider 
the edge of these squares. The Empress Josephine was lovely, 
but her teeth were not perfect, and in order to conceal them she used 
a small lace handkerchief, which she raised constantly to her lips. 
The ladies at the French court at once adopted the fashion, and 
handkerchiefs came into general use. Soon their convenience 
recommended them so highly that all the ladies and gentlemen 
connected with the various European courts adopted their use. 
The fashion thus introduced by royalty was soon taken up by the 
common people till today the handkerchief is an indispensable 
article of apparel. 

Carpets. Similar changes took place in the textiles used in the 
home, such as floor coverings. Carpets also were first used by 
priests for religious purposes. Later carpets and rugs were used by 
oriental people for kneeling in religious exercises and for sitting or 
reclining. Skill in weaving carpets has been handed down from 
the ancient Babylonians to the Persians of the present day. 

Among the common people of Europe the earlier type of floor 
covering was a thin spread of straw or sweet-smelling rushes. 


SOCIOLOGICAL BASIS OF CLOTHING 


65 


Until 1840 all weaving of mgs and carpets was performed by hand 
and their use was naturally restricted to the more wealthy homes. 
Today, because of the invention of machinery, beautiful and dur¬ 
able rugs and carpets are within the reach of all classes of people. 

Factors of Society. Wearing apparel has been influenced by 
habit and custom. The three most important factors in the life 
of society are habit, custom, and social organization. Habit has 
been discussed in the previous chapter. Custom is the practice 
or usual manner of doing a thing. That is, certain behavior is 
the common practice of society, hence we all, because of our in¬ 
stinct of imitation, tend to follow the prevailing custom of the 
society of which we are part. Custom is the main principle of 
social control. As the result of years of tradition, different coun¬ 
tries thus tend to build up different ways of performing the same 
acts, different recreations, different educational systems, social 
codes, etc. All these traditions and customs tend to determine a 
country’s standard of life, in clothing as well as in other realms. 
Certain examples will show how habit, custom, and social organiza¬ 
tion have determined and regulated the clothing worn at different 
periods and in different countries: 

(a) The use of kilts or skirts for men in Scotland. 

( b ) The wearing of trousers by the women of China. 

(c) The veiling of women in Mohammedan countries. 

The great part played by social organization in determining the 
type of economic life will be discussed later. 

Social Mind. It is surprising how quickly members of a com¬ 
munity will acquire new ideas or imitate the actions and ideas of 
their leaders in regard to clothing, etc. Contrary to the idea of 
many people, there is no such thing as a community or social mind. 
Each individual of society has a mind of his own, but through 
imitation, sociability, sympathy, and suggestion, a certain unity 
of thought develops that is often called the social mind. Fashion 
of clothing is an excellent example. 

If we follow very closely the history of civilization, we shall 
find that the “ social mind ” of each period is dominated by the 
ideals of that period. Each period of history, each civilization, 
has its theory of the aim and purpose of the things of life, which 
we may call its peculiar philosophy of life. In some periods — 


66 


ECONOMICS OF CLOTHING AND TEXTILES 


Puritan New England — life was severe and beauty and pleasure 
were considered sinful. No one in that section could have other 
ideals. The same is true with all other periods. These different 
ideals of different peoples constitute a valuable contribution to 
history, as they show the many ways of going through life. By 
taking the best of all the ideals we shall secure a well-balanced 
life — democracy — every one to lead a happy useful life, to be 
a source of joy to his family and an asset to his country. It is 
not well for a democratic community to be divided into sharp class 

distinctions, all with different 
social aims. 

The “social mind” may have 
a serious or semi-ludicrous point 
of view, which may prevail 
at any time, and is called a 
“ mental epidemic.” Certain 
fashions are special types of 
mental epidemics, especially the 
extremes of fashion, involving 
many motives, all based upon 
the human instincts. 

Few of us realize how quickly 
we respect the rules, stand¬ 
ards, and conventions generally 
adopted by society. This readiness to adapt our ideas and actions 
is due to the fact that from birth to death we are under educational 
influences, either direct or indirect, formal or informal, that mold us 
unconsciously to the accepted customs. Thus we wear clothing that 
will meet with the approval of public opinion. Conformity to the 
established conventions and morality is usually brought about by 
social pressure — a threat or fear of ridicule, contempt, or social os¬ 
tracism. When public opinion, the social method of control, fails, 
the state may step in and supplement the control by physical 
restraint. The practices of certain people, called “ nudists,” who 
would like to have both sexes go about, go in bathing, and take sun 
baths without clothing, are contrary to the accepted conventions in 
this country. Therefore we find the police stepping in and restrain¬ 
ing the nudist movement, sometimes by placing offenders in jail. 



Grotesque Figures 


SOCIOLOGICAL BASIS OF CLOTHING 


67 


Culture Mass. The accumulated ideas, customs, and habits 
that a society inherits and constantly adds to are sometimes called 
the culture mass of the society. This accumulated culture is 
carried from place to place by mail, telegraph, and telephone, by 
writing and printing, and is now broadcast by means of the radio. 
By increased interaction of social organizations we are now in¬ 
fluenced by the ideas of persons many miles away. Thus our 
culture mass is infinitely broader than that of ancient civilizations. 
Nevertheless, just as children in the wilds of Africa acquire the 
ideas and morality standards of the uncivilized African, the lives 
of all of us depend a great deal upon the culture mass that surrounds 
us. The children of savages will follow the example of their 
parents and will go with little or no clothing. American children 
will tend to follow the prevailing standards of dress in our own 
country today. 

Culture of Each Race. Differences in the culture mass of various 
races result in many varied expressions of that culture. The ways 
in which such universal instincts as the love of the beautiful 
have been developed in the different societies illustrate the effect 
of the cultural background. Note, for example, the artistic cotton 
fabrics that were designed and made in India. A history of those 
beautiful cotton prints reads like a romance. 

The India chintzes were in much demand in Europe long before 
the art of making them had been introduced and simplified there. 
Most of them were made by very tedious processes, a great part 
of the pattern being colored by hand. The parts intended to be 
white were covered with wax before the material was thrown into 
the dye-vat, and the process of removing the wax afterwards 
required considerable time and no small amount of patience. 
Small quantities of these chintzes were shipped to England and 
Holland as early as the 12th century, and there seems to be lit¬ 
tle doubt that an attempt was made in Europe in the direction 
of printing patterns on cotton as early as 1634. The introduction 
of cotton printing into Europe is due mainly to the Dutch, and 
the Dutch East India Company had taken the India chintzes to 
Holland before they were heard of in England. Flemish emigrants 
imported the art to England about 1676, and later other works sprang 
up to supply the London shops with chintzes, their importation 


68 


ECONOMICS OF CLOTHING AND TEXTILES 


from India having been prohibited by parliament in 1700. This 
infringement of the rights of consumers having been received with 
equanimity, parliament next proceeded to pass a law prohibiting the 
wearing of all printed cottons —a law that actually remained in 
force for sixteen years and nipped the rising industry in the bud. 

Other countries have made the following contributions to 
textiles and wearing apparel, as their part of culture : 

(а) India, Turkey, and Persia — floor coverings of exquisite 
designs, colors, and symbolism. 

(б) China — velvets, embroideries of rich design and color, 
coolie coats, designs for leisure clothing, etc. 

(c) France — silk fabrics, tapestries, rich designs, and inspira¬ 
tions for wearing apparel. 

( d ) Japan — kimono. 

(i e ) Switzerland — laces, embroideries of rich design. 

(/) Belgium — laces and other textiles of rich design. 

(g) Italy — rich samples of old brocades, damasks, velvets. 

(h ) Spain — shawls, veils, etc. 

(i) Greece — rich inspiration of art, draping effects of clothing. 

(j) Slavonic countries — Beautiful samples of embroideries in 
colors. 

Social Influence of Clothing. According to statisticians, there 
are about five hundred million of the human race who are well 
clothed —that is, who wear complete garments of some kind. 
Seven hundred million cover only certain parts of the body, and 
two hundred and fifty million go entirely naked. History teaches 
us that man originated in tropical regions, hence it is reasonable 
to suppose that on account of the mildness of the climate, the 
garments adopted by man in the first stages of his existence con¬ 
sisted of only such as were required for decency. As the popula¬ 
tion of the earth grew, gradually extending northward to less 
favorable regions, and was divided into nations and classes of 
society, additional clothing became necessary, both for comfort 
and as a distinguishing badge of nation or of class. Philosophers 
assert that clothes are our friends or our foes all the days of our 
lives. They affect our health, to say nothing of our worldly credit, 
and are never without some influence, pleasurable or the reverse, 
upon our associates. 


SOCIOLOGICAL BASIS OF CLOTHING 


69 


Clothing and Domestic Life. Since the making of yarn, cloth, 
and clothes was, up to a century ago, carried on in the home as 
part of the household duties, it is very natural that the social life 
and home life should be tied up very closely to spinning and 
weaving. In fact, women were expected to spend all their leisure 
time sewing or knitting, and a definite part of the day was devoted 
to spinning and weaving. The only time allowed for relaxation 
were the few days at the religious festivals such as Christmas. 
To illustrate: St. Distaff’s Day is the seventh of January, the 
day after the Twelfth Day, or Epiphany, so called in England 
because on that day the women resumed their distaffs and other 
ordinary employments after the relaxation of the holidays. 

From early history, when man lived in caves and wore the skins 
of animals to our present times, clothing has been intimately 
associated with the home and social life, even to the extent of 
providing us with family names, recreation, and designation of 
rank. 

In Great Britain, the early inhabitants were thoroughly ac¬ 
quainted with the making of cloth, and the weavers of London 
established the most ancient guild in Europe. Their occupa¬ 
tion gave rise to many surnames, which are easily recognized in 
the United States at the present time. For a long period wool 
was the staple product of England, and thousands of busy oper¬ 
atives were employed in the various processes of spinning and 
weaving necessary before the wool could be transferred from 
the back of the sheep to the back of man. At every step proper 
names sprang up, indicative of the calling of those who bore them. 
Were we ignorant of the fact that our ancestors, the Saxons, dealt 
in wool and made cloth, we might draw perfectly correct and 
legitimate conclusions as to the trade, its extent, and various 
departments, from the family names still surviving. In the first 
place, the sheep were cared for by the Shepard or Sheepherd, a 
family name that, with variations of spelling, is extremely common 
both in this country and England. Shearing was the first opera¬ 
tion requiring either delicacy or skill, and Shearer, Shearman, 
Shurman, and similar names bespeak their own ancestry. The 
wool was then placed in bags, made by the sackers or canvassers, 
and was ready for the merchant, an individual often known by 


70 


ECONOMICS OF CLOTHING AND TEXTILES 


the name of Stapler, Wool, Wooler, Wollman, or Woolsey, or 
in French as Lanier or Lanyer. He consigned it to the care of 
persons who transported it from place to place on the backs of 
pack horses or in vehicles, and were thus known as the Packers, 
the Carters, or the Carriers. The wool was then handed over to 
the Carders and Combers, or Kempers and Kemsters, as they were 
variously called, and passed from their hands to those of the 
Spinners, who used implements made by the Spindlers and Slayers. 

It went afterwards to the Weavers, Weevers, Webbs, Webbers, 
or feminine Websters. The cloth was next “teased’’ to bring 
out the nap, a process done by the Teasers, Tosers, Teazelers, or 
Taylors, when the woolen cloth was finished and ready for the 
Dyer, Litter, or Lister. The Fullers, Fullertons, Fullersons, and 
Fullmans undertook the process of shrinking the cloth, in which 
they were assisted by the Walkers, who trod it with their feet, 
and by the Beaters, Beatermans, Bates, Batts, and Battsman, 
who used sticks, bats, and mallets instead of their heels and toes. 
The designation of each process gave a name to all engaged in a 
special work, just as at the present time, and was adopted in these 
early days as a family name by some who perhaps attained notable 
excellence over their fellows, or were led by chance or caprice 
to adopt the title of their calling as their own surname. 

It will doubtless interest many to learn that the domestic title 
“wife” is derived from “to weave,” since she was distinguished 
from the others in her family in the olden time by her labors at 
the loom. The Saxon word for weave was wefan, and was also 
applied to a woman who worked at the loom and made a web. 
The adoption of the name “wife” from the art of weaving is a 
natural sequence to giving the name of “spinster” to an unmarried 
woman, for the girl was supposed to spin the yarn for the clothing 
she was to wear in the future as a wife. For centuries preceding 
Cartwright’s invention of the power loom, each household to a 
large degree manufactured its own cloth and made its own clothing. 
It was the common practice of the husband and sons to tend the 
sheep and cultivate the flax; of the “spinsters” to prepare the 
yarns, and of the “wives” to weave the cloth. 

The early history of the manufacture of sewing silk in America 
illustrates its development as a household art. More than a hun- 


SOCIOLOGICAL BASIS OF CLOTHING 


71 



dred years ago, silk thread-making promised to develop into a great 
industry. Throughout New England, Pennsylvania, Delaware, 
and South Carolina during the colonial period, the production 
of sewing silk was a household art, the present manufacture being 


A Simple Hand-Loom 

a development of that early fireside industry. In the years imme¬ 
diately preceding and following the Revolution, when the country 
was impoverished and money extremely scarce, the women of 
New England adopted silk-culture as a means of obtaining a 
livelihood. Their chief product was skein silk. The methods 
of| reeling and twisting the thread were very primitive, and much 
of the silk became tangled and wasted. The lustrous fiber was 
unwound from the cocoons upon clumsy hand-reels, the threads 
twisted on spinning-wheels made for wool, and the precious 
skeins dyed in pans and kettles ordinarily used for domestic 
purposes. After dyeing, the thread was made into skeins con¬ 
taining twenty threads, each two yards long; twenty-five skeins 






72 


ECONOMICS OF CLOTHING AND TEXTILES 


constituted a “bunch,” and four bunches a “package.” Because 
of the lack of money, this skein silk took its place, and in New 
England particularly it was very generally exchanged (bartered) 
at the stores and shops for the necessities of life. At this period 
the homemade product was worth $1 per ounce. 

In 1656 the colonial government of Massachusetts enacted a 
statute requiring each family to spin three pounds of wool, cotton, 
or flax a week, for thirty weeks each year. In the same year the 
first weaver to settle in Massachusetts began operations at Lowell. 
He was tendered official encouragement in the form of a grant of 
thirty acres of land. 

Progress. The progressive development of the clothing indus¬ 
tries today has made wonderful contributions to our health and 
happiness. The lack of progress in the manufacture and use of 
clothing in primitive times was due to the inertia of the people. 
They disliked any form of change. As civilization developed, 
progress became more rapid, until today there is a positive desire 
on the part of all, particularly in this country and in most others, 
for improvements in both organization and methods of the manu¬ 
facture. 

The progress in the manufacture of clothing has been due to the 
many inventions of automatic machinery, which have increased 
production and reduced the cost of the finished article. Improve¬ 
ments have also been made in raw materials and in organization. 
This progress has given us a larger product with a smaller expendi¬ 
ture of human effort, and thus given us leisure. The result of 
this leisure time has been to contribute to mental, social, and 
emotional development. In primitive times the struggle for 
existence was so great as to leave no time for leisure or enjoyment 
of the higher things of life, such as music, art, literature, good 
clothes, etc. The exchange of thoughts, influence of mind upon 
mind, comes from the companionship of people and depends 
greatly on leisure and improved means of communication. 

As society becomes wealthier and more educated it develops wants 
for clothing that are more numerous and diversified. Naturally 
it puts forth greater efforts to satisfy these wants. These efforts 
to satisfy their desire for more and better wearing apparel are part 
of the various activities entering into the economics of clothing. 


SOCIOLOGICAL BASIS OF CLOTHING 


73 


Our standards of clothing, or properly designed clothing, called 
dress, change with our standards of living. What is meant by 
the “best” standard of living is not necessarily the ideal standard 
of living, but the satisfaction of the habits and requirements of 
life generally practiced in a given community or country at a 
given period by the higher classes. Hence we see that our stand¬ 
ard of living and clothing is distinctly social, governed by the 
demands and needs of our neighbors. 

Use of Wearing Apparel. The economic condition of a people 
has had much to do with the kind and amount of clothing worn. 
In ancient times in Sparta it took a year to make one costume, 
since all operations had to be done by hand, including the carding, 
spinning, and weaving of the cloth. The costume, when finished, 
was used for several generations. A complete wardrobe early in 
the 19th century cost $4000. All clothing was manufactured 
by hand and sold direct to the consumer. Before the advent 
of machinery shoes cost from $10 to $25 a pair; as a result many 
persons went barefoot. 

Today, because of modern methods of manufacture and the 
use of machinery, a complete costume can be made, from the 
shearing of the wool to the finished product, within a period of 
twenty-four hours. Some kind of wholesome and attractive 
clothing is now within the reach of even the poorest classes. 

Standards of Living. Our standards of living, including our 
taste in clothing, are the results of our social background and the 
training or education we have received. Since society in this 
country is open, without such distinct barriers as the caste system 
in India, it is natural that people with the same culture and inter¬ 
ests should form a homogeneous settlement. Our civilized society, 
while guided by the same instincts and desires as an uncivilized 
society, has made certain advances in culture and education, 
and as a result has acquired finer tastes and more varied desires. 
The uncivilized have the same fundamental desires but express 
them in a crude, unrefined manner according to their lower stand¬ 
ards. While civilized society selects better and more artistic 
clothing, we often find much to admire in certain ornaments or 
decorations used by the savage or semi-civilized races. Note the 
artistic designs of clothing worn by the women of Java. 


74 ECONOMICS OF CLOTHING AND TEXTILES 


The American Standard of Living. When we speak of the 
American standard of living, we do not mean an ideal system of 
living, but the habits and requirements of life in a community or 
grade of society at a given time. To illustrate: The standard 
of life of the ordinary workingman in the United States includes 
clothing, food, and shelter of a kind quite different from those 
of the workingman in China or any other country. In addition, 
the standards of life include the machinery for ministering to 
the wants of the people, methods of social intercourse, recre¬ 
ation, etc. 

Many forces at work for a long time on the character and en¬ 
vironment of a class have much to do with its standard of living, 
particularly in the matter of clothing. In many cases in our own 
country it is possible to express the standard of living in terms 
of money, which is called the cost of living. Nevertheless, it 
is impossible in a complete analysis to include all elements of 
the standard of life in terms of money. For we must remember 
there are a few that differ from the majority of individuals in 
tastes, capacity for management, etc. 

There has existed more or less among the people of the world 
since the time of Greece the idea that the prosperity of any society 
depended in a large degree upon the existence within it of a large 
mass of ignorant poor. This notion still prevails among us, and 
we feel that the prosperity of part of the people depends upon 
the adversity of the rest of the people. All of which means that 
the poor should not know the joys of life, including a variety of 
clothing. 

This theory is very destructive, and has caused much harm. It 
is due to the old tradition handed down to us from the ages when 
a caste system existed. Such a theory is undemocratic. Econo¬ 
mists know that it is possible for an economic society to expand 
and improve living standards as it raises the productivity of labor. 
The partial abolition of poverty has become a business necessity, 
lest prosperity be permanently destroyed by an insufficiency of 
buyers. 

A higher standard of living is not represented merely by goods. 
It includes more leisure, better education, better care of health, 
more travel, better wearing apparel, and more spent for that which 


SOCIOLOGICAL BASIS OF CLOTHING 


75 


is beautiful as well as useful. American civilization has gone a 
long way, but it still has far to go toward improving the wearing 
apparel of all the people. 

Any movement or cause that tends to lower the cost of wearing 
apparel will tend to increase the welfare of the people by giving 
them more necessities and luxuries in clothing, thus producing 
more happiness. 



By raising the standard of living we naturally increase the 
ambition of the worker, so that he tends to exert greater efforts 
to meet his needs or wants. Of course, we must bear in mind 
that the tendency to raise the standard of living sometimes 
decreases the size of the family. 

With the increase of the standard of living of the lower and 
middle classes would come a desire to buy more clothing and 
services, which in turn would increase the market. Advertising 
would suggest these wants, and readers would desire to satisfy 











































































76 


ECONOMICS OF CLOTHING AND TEXTILES 


them. Increased purchasing power of the laboring class is the 
best sign of prosperity. Ignorance and poverty, on the other 
hand, tend to breed social unrest. 

The increase in the living standard of the American people 
above all other nations is due to (1) the natural resources which 
have been highly developed, (2) the harnessing of water falls, and 
utilization of electrical and gas energy on a large scale, resulting 
in cheap power, (3) utilization of automatic machinery and mass 
production, (4) ability of the American to adapt himself through 
cooperation to large organizations and the use of efficient machine 
methods, (5) combination of labor into unions under efficient 
leadership, (6) a friendly spirit between labor and capital, (7) in¬ 
stallment buying, (8) a large home (domestic) market without 
tariff restrictions, (9) protection against excess of imports by a 
protective tariff, (10) immigration restrictions which have elimi¬ 
nated the classes with very low standards of living, (11) higher 
standards of appreciation of the uses and joys of a variety of 
wearing apparel, (12) ability of producers to supply wearing 
apparel both useful and artistic, within the reach of all consumers. 

Since the family is the unit of society, it follows that in the 
interest of social welfare the family should be kept from the horrors 
of poverty, famine, pestilence, etc. How can these conditions be 
kept from the family? We have seen that these can be prevented 
by efficient living or a proper standard of living. This standard 
of living determines the necessary income of the family. For 
most people this income is derived from the earnings, wages, or 
salary of the head of the family. 

What determines the standard of living? The standard repre¬ 
sents the needs of a family; that is, the goods and services that 
are regarded as necessary and that they will attempt to obtain at 
any sacrifice. Observation will show us that this standard varies 
with different classes: (a) leisure, ( b ) professional, (c) business, 
(d) mechanic, ( e ) laborer, etc. 

The minimum standard is the standard adopted by the ordinary 
family of a class living in frugal circumstances; that is, exercising 
economy and avoiding waste in all forms of living. The income 
or wage sufficient to meet the minimum standard of living is called 
the minimum wage. The amount of this wage in money, of course, 


SOCIOLOGICAL BASIS OF CLOTHING 


77 


varies from time to time with different classes and by different 
estimates of the things that may be included among the necessities. 

The minimum wage should be established for the lowest type of 
unskilled labor, and should be enough to support a family in frugal 
circumstances. If there is any industry that can not afford to 
pay such a minimum wage, such trade or branch of industry is 
un-American in principle and should not be allowed to exist. 
Low grade labor is usually highly supervised. Part of the cost of 
supervision could then go to labor. 

Since industry employs many types of workers, it follows that 
there should be a difference in the wages paid, from the minimum 
to the highest. The differences in wage rate, called differentials , 
should be sufficient to give at least a wage for the minimum stand¬ 
ard of living for each class. 

Social Standard Wage. The welfare of the community demands 
that each component of the community should enjoy equitable 
rights; if these are denied, social discontent and disunion, class 
hostility and conflicts arise. Social justice concerns itself with 
the outward actions of men in their bearing on the common 
welfare. Therefore, justice demands the natural right to live in 
accordance with the dignity of one’s personal nature; that is, 
having clothing, food, shelter, proper comfort, money for raising 
a family, leisure for attending to one’s mental, moral, and religious 
development. The social standard wage is one that will provide 
these rights. 

Social Organizations. Society readily devises schemes, methods, 
and plans for accomplishing activities that are for the common 
welfare. Such arrangements are the basis of social organization 
and comprise a definite program of social activities that has been 
developed over a long period of time. In a civilization such as 
ours, the social organization is developed to a high state of com¬ 
plexity, requiring a high degree of cooperation for its successful 
functioning. 

The reason that the members of the community adopt the same 
standards is because their strength or common advantage in 
both physical and moral phases is best realized by combined ac¬ 
tion. A community is composed of individuals of varying types or 
moods; therefore the will power of the different types will vary. 


78 


ECONOMICS OF CLOTHING AND TEXTILES 


When this difference is sufficient to cause a lack of uniformity in 
social standards it tends to destroy the common end. In order 
to carry the wishes or actions of the members to the highest success, 
it is necessary that the people be organized into communities or 
societies like the town, city, state, and nation. 

The success of any society, community, or business organization 
depends largely upon the degree of cooperation. To illustrate: 
The success of a dry-goods store depends upon the ability of each 
employee to work with the rest of the store organization in perfect 
harmony, to secure high efficiency with the least effort. Coopera¬ 
tion of the highest type with department heads and executives and 
also with manufacturers has done much to improve a buyer’s 
performance. 

A fine spirit of cooperation on the part of business associates 
as well as nations will promote friendship, efficiency, and harmony. 
On the other hand, a lack of cooperation will lead to friction, 
exploitation, and rivalry. Due to the rapid communication 
between the different nations important events and attitudes in 
one country are reported in every other country within a few hours 
after they have arisen. As a result, all the nations of the world 
are interdependent to a large degree, not only in culture, politics, 
and economics, but in such specific commodities as clothing. We 
obtain silk from Japan, rugs from Persia, linen from Ireland, etc. 
This interdependence is recognized to a high degree, and the 
political and trade relations of our nation are influenced by repre¬ 
sentatives sent to each country. In a similar manner other 
countries send diplomatic and trade representatives to this country. 

The League of Nations is an attempt at still greater cooperation 
between the various nations of the world. From time to time, 
international conferences are held in an attempt to settle such 
disputes among nations as the question of tariff walls, taxation 
on imported textiles, clothing, and the like: 

Business Organization. In order to meet the needs and wants 
of society, certain general principles for the organization and 
conduct of business have been developed to insure a certain degree 
of efficiency and to give employment to the members of society. 
One of the greatest prizes of life as it is organized today is the 
acquisition of money, and naturally money, more than anything 


SOCIOLOGICAL BASIS OF CLOTHING 


79 


else, prompts people in their choice of work. Hence most people 
try to enter into those lines of employment or business that give 
the greatest money return. 

Since society is composed of groups of individuals with common 
interests, it is only natural that these common interests often 
conflict with the self-centered interests of some individuals. So it 
is natural that society, after years of experience, should determine 
certain conditions governing business that give the greatest eco¬ 
nomic benefit. These conditions may be expressed as follows, 
and society encourages its numbers to heed them: 

(а) Produce those goods that are of greatest benefit to society 
as a whole, rather than to a few individuals. 

(б) The production of these goods should be carried on in the 
largest quantities until the needs of the people are satisfied. 

( c ) These goods should be sold at the lowest possible prices. 

The individual with his self-centered interest is anxious to seek 
his own advantage, which may include the production of goods 
for a selected few, i.e., luxuries of wearing apparel, so that he can 
make as much money as possible with the least amount of effort. 

Hence society encourages business to develop to the highest 
degree of efficiency so as to' produce wearing apparel and other 
necessities and to introduce luxuries of all kinds to all classes of 
people, not only to meet their needs but also to provide employment 
to members of society. 

Division of Labor. From early times to the present, human 
nature has gradually become accustomed to regular habits of work 
and to the use of tools. As soon as groups of individuals become 
proficient in one line of work they develop that line and become 
specialists. 

Subdivision of labor often becomes monotonous and wearisome. 
The employment of the senses and muscles in the same way all 
the time becomes distasteful and even painful. The advantages 
of the subdivision of labor should bring shorter hours and more 
pay to the laborer. The shorter hours balance and overcome to 
some extent the disagreeable features of the work. 

Private Ownership of Property. Two of the most important 
institutions of human society are the family and private property. 
Each member of society is entitled to the pleasures of family life 


80 


ECONOMICS OF CLOTHING AND TEXTILES 


and to the use and control of whatever property he owns (private 
property). Society early recognized these two rights and protects 
the members of society in maintaining them. Of course the right 
to private property may be modified whenever society feels that 
it is necessary for the best interest of its members, but this can be 
done only by legal or legislative action. 

For centuries society has extended to its members property 
rights over the goods they possess. The desire to possess goods 
encourages us to work harder in order to possess as much as pos¬ 
sible. On the other hand, society demands in return for the 
running of the government: (a) the right to take part of the 
property in form of money for taxes, (6) the right to seize property 
in time of war for military purposes, with a fair compensation for 
owners, (c) the right to seize property at a fair compensation for 
increasing the public welfare (the right of eminent domain), 
(d) the right to enforce proper use of private property — use in 
a way that will not conflict with the rights of others. 

Society allows an individual to engage in any trade or profession 
(the right of freedom of enterprise), provided the business does 
not interfere with society in general and provided the person is 
properly qualified to do the work. The right to conduct public 
corporations, like railways, etc., requires a franchise or special 
permission from the government. 

Social Monopolies. In order to encourage new ideas and 
inventions, society has given to inventors, designers, etc., a right 
called a patent — that is, a monopoly or exclusive privilege for a 
number of years to produce that invention or design. This form 
of monopoly is a legal monopoly as compared with a business or a 
natural monopoly. A business monopoly is the control of com¬ 
modities, business, or resources of nature in such a way as to enable 
the person or persons exercising it to fix prices (such as a registered- 
name fabric). Whatever is marketable, as material goods, labor, 
natural resources, or money, may be the subject-matter of monop¬ 
oly. The essence of monopoly does not consist in exclusive owner¬ 
ship, but in exclusive or dominating power to regulate the market 
in regard to things that are not of their nature the exclusive posses¬ 
sion of an individual or body of individuals, and that, therefore, 
are subject to competition. The government has an Anti-Trust 


SOCIOLOGICAL BASIS OF CLOTHING 


81 


Law (Sherman Act) that prevents producers from combining to 
fix prices. Many people feel that such a law is a hardship during 
a depression, when there is a tendency to lower prices below cost of 
production, resulting in driving many manufacturers out of business. 

We have seen in the previous pages of this chapter that every¬ 
thing — industry, commerce, etc. — exists for society. Society 
consists of groups of families and people living together for the 
development of the family and the happiness due to social activities. 
Society created industry and commerce to provide means of meet¬ 
ing these wants and also to provide employment for each member 
of society able to work. 

Society is most efficient when it can meet the needs of its mem¬ 
bers and provide continuous employment for all those able to 
contribute to the success of society. This requires that the 
population should be distributed in such a manner as to provide 
homes for all and sufficient land or labor for every one. If there 
is an excess of labor there is unemployment, and society suffers. 

While inventions and processes for quickening the production 
of commodities — such as automatic looms for weaving cloth, 
etc. — have met the needs of all members of society, in many 
cases they have (a) been the means of replacing many members of 
society as workers, thus causing unemployment and not giving them 
the power to purchase the necessities of family life, and (b) also in¬ 
creased production so as to cause excess of certain commodities. 

Many manufacturers and inventors are intensely selfish and 
self-seeking and lack high social ideals. While they may not 
always be able to see the future and evil influences of machine 
production, nevertheless every producer, inventor, and consumer 
should have sufficient knowledge of industrial history and of the 
principles of economics to see clearly the effects of inventions 
and machinery on the welfare and progress of society. Producers 
and inventors should exercise intelligence and sympathy in placing 
on the market machines and processes for more production and 
replacement of workers, so that it may be done gradually and 
systematically. In this manner society can make readjustments 
through new sources of employment, or a shorter working 
week, so as to absorb the excess units of labor released by the 
invention of new methods of production. 


82 


ECONOMICS OF CLOTHING AND TEXTILES 


We must remember that the invention of new machinery and 
processes is not a complete end in itself, but is one of the factors 
for meeting the needs of society — human satisfaction. The 
machine or process by itself is nothing unless it serves the best 
interests of all of society — humanity. 

During the last hundred years and particularly during the last 
generation, the invention of machines and processes has multiplied 
the productiveness of human labor, while reducing the physical 
fatigue that has gone with labor. It is true that as a result of 
these inventions, particularly in clothing, we have obtained higher 
standards of living and no doubt shall attain still higher standards. 
But with the invention of new machines and processes there have 
developed social problems in employment and overproduction of 
certain kinds of clothing, so that there are times when the machin¬ 
ery is idle and human beings are out of work — unable to have the 
necessities of life — and live in squalor and want. In other words, 
new inventions have provided machines that have outstripped 
social progress and upset the social economic balance of employ¬ 
ment and the needs of the people for the commodities. 

Individual Rights. Since society represents a group and the 
moral code represents the standard that is considered best for the 
majority, it follows that society must consider the natural rights 
and the social or legal right of every member of society. The 
natural right of man — called the natural law — represents the 
rule of conduct dictated by common sense and the conscience of 
mankind and is a law of self-defense or of the right to live, while 
the social right is a need of man that society must also protect. 
Society may or may not protect the natural rights of man, but 
the right of contract is a right that society must protect. The 
right to protect children and women from long hours of employ¬ 
ment is a social right today. New laws prevent sweatshop 
work in tenements, compel manufacturers to assume accident 
risks and to permit employees to join unions, allowing collective 
bargaining. Many natural rights have become legal rights in the 
process of human development. 

For centuries it was considered proper, and a moral and legal 
right, for an owner to do as he pleased with his investment or 
property, but today with the growth of democracy the belief has 


SOCIOLOGICAL BASIS OF CLOTHING 


83 


developed that the great mass of working people constitute so¬ 
ciety and therefore must have a voice in the management of 
industry. Our ideas as to the natural law have changed and are 
constantly changing, and these changes affect our social and in¬ 
dustrial system. 

No industry has greater problems than the textile and the cloth¬ 
ing trades. Due to the rapid development of textile mills and 
clothing shops or factories and to the use of power and automatic 
machinery, the production of cloth and costumes has been on such 
a large scale that the great middle class of small textile manu¬ 
facturers and tailors and dressmakers has rapidly disappeared. 
As a result there has been a tendency toward the formation of two 
extreme classes in the textile-clothing-factory system — a small 
number of wealthy manufacturers and a multitude of workers, 
many of whom receive very small wages. The manufacturers 
themselves have found that there were many who engaged in 
sharp practices and other means to defraud. Hence society has 
provided means for removing these evil practices. 

In every group of people you will find two conflicting factors: 
(a) cooperation and ( b ) disagreement. That is, there are always 
displayed the instincts of cooperation or working together, and 
disagreements or differences of opinion. These two instincts may 
appear to be distinctly opposed and eventually destructive, but 
the instinct of cooperation is stronger because mankind must 
always live in groups, and hence there is always a desire to agree 
and a procedure of agreeing until the decision of the majority is 
adopted. 

Of course, due to lack of unity of mind and lack of constancy of 
will on the part of human nature, there is a tendency on the part 
of man to feel that society curbs his individual rights. While 
this is true in limiting his individual good, it obtains for him a 
greater good by life in society and frees him from many evils. 
The same is true in the distribution of the social income. Labor 
feels that it has not received its just proportion, hence the constant 
disputes between mill workers and owners, garment workers and 
garment manufacturers. 

At the beginning of the industrial era and the factory system, 
the theory of unrestricted competition in trade meant that the 


84 


ECONOMICS OF CLOTHING AND TEXTILES 


employer, having many units of workers, might increase his wealth 
quickly and become very powerful, while the laborers became 
weak because of long hours of work and low wages. 

As a result society stepped in and government has attempted at 
various times to pass laws regulating such matters as (a) hours of 
labor, (6) juvenile employment, (c) minimum wage, (d) com¬ 
pensation insurance for injuries of workmen, (e) restriction of 
immigration, etc. 

When the textile and clothing industry was transferred from 
the home to the independent establishment or small shop, there 
naturally remained a desire on the part of many workers to do 
textile and clothing work at home. The poverty of many of the 
families meant that they did the work at a small compensation 
amidst dirt, disease, etc. Establishments whose work was done 
under such conditions were called “ sweat shops.” 

Since much of the work in the textile industry is of an inter¬ 
mittent character, such as changing bobbins or spools and then 
resting before another change, and since broken threads had to be 
pieced or mended, there easily grew up a demand for juvenile 
labor, even as young as seven years of age. The juvenile help 
became accustomed to mill conditions and became future weavers, 
etc. Today, because of automatic machinery that has increased 
the productive power of the mills, it has been possible to do away, 
in a large degree, with child labor. 

A new conception of the duty of the managers of great industries 
has gradually developed. The old notion that it should be their 
chief concern to “take as much as possible from workers and the 
public for the benefit of stockholders” has gone never to return. 
Any company now large enough to be affected with a public in¬ 
terest must have officers who regard themselves and act as trustees 
with a threefold responsibility toward investors, toward workers, 
and toward consumers. The heads of great companies must 
decide what should be done during times of depression. How 
shall the business be kept going? Where can severe economies 
be made and where must they end? How shall men who have 
to be laid off, or given part-time work, be dealt with in an emer¬ 
gency that it is hoped will be temporary? The ancient view that 
wages need not rise higher than the “ subsistence level ” broke 


SOCIOLOGICAL BASIS OF CLOTHING 


85 


down in practice, and had to be modified by legislation. An en¬ 
tirely new thought about managerial responsibility has come to 
be dominant in the modern world. The profit-motive remains 
and must remain, but it is no longer supreme. The humanity- 
motive has entered. A spirit of fair play, neighborly interest, 
and intelligent provision for the nation is now emerging. 

State Paternalism. Many persons feel that the government 
should not interfere in the conduct of business. Others feel that 
the government should exercise a fatherly spirit and protect the 
workers against exploitation and abuse. Hence in this country 
today, we find advocated two distinct policies on the part of the 
government toward the textile industries, etc.: (1) the policy of 
laissez faire (let alone) on the part of the state or nation; (2) the 
policy of protection — state or national paternalism. 

As a rule there is a general feeling on the part of thoughtful 
citizens against the interference of government. This feeling can 
be overcome only by strong evidence that there is need for action. 
Individuals guard their rights jealously, and there is a feeling that 
individual freedom is constantly in danger. Then again, there 
is also danger that the tasks of government may become so great 
and burdensome that any increase may tend to destroy its effi¬ 
ciency. 

Many sincere citizens and statesmen are constantly asking for 
state and national aid for education and other forms of community 
activities. In return for this aid, the state and national govern¬ 
ments demand more or less supervision. The policy of state and 
national supervision may appeal to some minds because of the 
immediate effects of the aid, but a careful investigation will show 
that a certain danger comes when the granting of financial aid 
becomes a fixed policy. 

The majority of citizens will agree on the following general prin¬ 
ciple : that the state should protect the individual in all economic 
matters that effect support and continuance of life. This means 
the right (1) to protect private ownership, (2) to protect contracts 
for laborers, (3) to prevent exorbitant prices for the necessaries 
of life, (4) to protect workmen from dangerous labor, and (5) to 
protect society from danger to good morals, religion, and family 
welfare. 


86 


ECONOMICS OF CLOTHING AND TEXTILES 


Social Control. In order to carry out the aims of society — the 
development of the home, industry, and government — it is neces¬ 
sary for all of us to agree to abide by the rules emanating from an 
invisible power called social control or public opinion. The success 
of society, industry, and government depends on how well we obey. 
It may be the law that compels us to obey, in some cases, but the 
feeling that we may lose our job and be ridiculed or shunned by 
our fellowmen is a stronger force. Respect is the feeling that we 
wish our fellowmen to have for us, therefore we tend to govern 
our actions in a way that will compel this respect and approval. 

Because some of the members of society have not received proper 
training and do not have respect for laws and the observance of 
the rights of other members of society, certain penalties are exacted 
for the commission of misdemeanors or crimes. The penalty is 
placed before the members of society in order to develop the 
instinct of fear, which in many cases is sufficient for the prevention 
of crime. 

However, there are many persons who think they can break the 
laws of society and escape detection. In other words, the selfish¬ 
ness of the individual is above the fear instinct. Society inflicts 
a penalty on the guilty individual as a punishment to him and a 
warning to others. 

Religious Influences. The spirit of religion has always been with 
mankind. We may say that there is really an instinct to worship. 
Some theory was always invented among the savages to explain 
the unknown — some way to associate a conscious spirit with all 
animate and inanimate things that surrounded them. Each tree 
and animal had a spirit soul, according to the belief of the heathen. 
As civilization advanced these beliefs were enriched and made 
fuller. Religion has become a social force in regulating behavior; 
in fact, it is the strongest social force. In addition, religion has 
entered into the most important activities of the people. To 
illustrate: The silk industry in ancient China was considered so 
vital to the prosperity of society as to be interconnected with 
various religious rites. 

Moral Code. Among all people, even the uncivilized, there are 
certain acts and practices that are forbidden, and certain penalties 
are imposed on persons who commit these forbidden acts. These 


SOCIOLOGICAL BASIS OF CLOTHING 


87 


customs constitute the moral code and represent the results of 
years of experience. The power of this moral code to exact 
obedience has been acquired through imitation and the formation 
of habits during early life, reinforced in many cases by compulsion 
through fear of punishment. In fact, to this day, fear is one of 
the principal motives of obedience. 

Since the moral code is based upon experiences of the race, and 
since these experiences differ in different countries, because of 
religious, social, economic, and geographical conditions, it follows 
that the moral code will differ in different countries and at different 
periods of civilization and industrial progress. The tendency is 
for a code of morals to be adopted that is best for the majority of 
the people in a certain period of civilization and industrial condi¬ 
tions. We know today that (a) self-control, (6) thrift, (c) respect 
for others, and ( d ) diligence are part of a moral code that is neces¬ 
sary in this age of industry. The test of a moral code is the way 
it functions over a long period of time. Hence our moral code is 
adapted for daily life and business (ethical standards of business 
or business ethics) and represents the experiences of the best minds, 
and therefore should be always respected and followed. 

We are very sensitive to the opinions of the members of our 
group in society. This instinctive sensitiveness to the approval 
and disapproval of one’s social group, or his friends and neighbors, 
is a basic characteristic of human nature and has great influence in 
forming our individual codes of morals and our standards of dress. 

Code of Ethics. The success or efficiency of any society depends, 
in a large measure, on the practices, conduct, and spirit of its mem¬ 
bers with reference to right and wrong, and to their obligations or 
duty. The experience of the race shows that it is necessary to 
have a standard of conduct and established practices for men to 
live together peaceably. Most people instinctively conform to the 
standard of ethics adopted by the majority. We may say that 
we are instinctively honest. “ The impulse to honesty is the 
greatest force in the conduct of American business.” The impulse 
to fairness is also instinctive, but in the rough and tumble world 
of competition, in the basic struggle for existence, and in the 
exercise of the instinct of acquisition, human nature too often 
yields to temptation. 


88 


ECONOMICS OF CLOTHING AND TEXTILES 


There are grave abuses on the part of that small fringe which 
lingers on the borderline of legitimate business that attempts to 
defraud; it is revealed in the intensity of the serious thrusts at 
each other by competitors who believe that the end justifies the 
means. No business or company, however, can ever win on a 
platform of unsportsmanlike conduct. Temporarily it may ad¬ 
vance, but ultimately it must be vanquished. The public opinion 
of the business world each day grows more powerful just as the 
public opinion of a consuming public will eventually aid in bringing 
to terms the merchant who engages in sharp practices. 

If business associations should serve as trade organizations and 
the Better Business Bureau idea should develop a better attitude 
between buyer and seller, based upon a desire to apply the rules 
of fairness which business collectively may adopt for itself, we 
should be lifting from the back of government, federal and state, 
some of the burdens that now weigh it down. 

Need of Authority. No human society can exist efficiently with¬ 
out authority. It is the most important element in every society. 
It is the right of the community to direct and compel the individual 
members to live in accord with the specific aim or purpose of the 
society. The right of authority is derived from the duty of the 
community, as such, to accomplish its specific purpose. This, in 
turn, arises from the bond or agreement by which a number of 
persons are formally made or constituted into a society or com¬ 
munity. Since society exists to carry out a definite purpose, it 
follows that it is the duty of each individual member to further 
or develop its specific aim. Therefore, every society has the right 
as its first essential function to enforce this duty. This right is 
called the right of authority. The history of the race shows that 
no society has ever existed successfully without authority. Since 
authority has always existed, it must be a dictate of nature and an 
absolute necessity in every society. 

The agreement or constitution of the society determines how the 
authority shall be vested. The ruling power in which it is vested 
is called government and may be a single person, group of persons, 
or the whole community. 

Common and Statute Law. Society has framed many of its 
rules for the regulation of its members in the form of laws. The 


SOCIOLOGICAL BASIS OF CLOTHING 


89 


two great classes of law in this country are spoken of as (1) com¬ 
mon law and (2) statute law. The common law is that put forth 
and explained by the courts in the many decisions of the past. 
The statute law is the body of positive regulations formulated by 
the legislatures of the states and by Congress. 

Much of our common law represents the customs of primitive 
communities of the Anglo-Saxon or Celtic races from which our 
English ancestry developed. Although other races or nations 
took part in the early colonization of this country, their systems 
of law gave way before, or were rapidly assimilated to, the common 
law brought by the English colonists. Substantially all the 
branches of the common law pertaining to business have been the 
growth of the last two centuries. The law prior to the last two 
centuries, that is, from the time of the Norman Conquest, was the 
feudal law, which was a gigantic system of real estate ownership, 
extending from the sovereign to the subject. In those days com¬ 
merce was slender, exposed to piracy, etc. 

Today some unscrupulous business men frequently set fire 
to their business establishments so as to burn or damage their 
goods or wearing apparel and secure insurance on the damaged 
goods. Both common and statute law provide imprisonment for 
those found guilty of such an act. 

Unsuccessful business men frequently turn over to their relatives 
large cash deposits and .then petition the court to declare bank¬ 
ruptcy. The common law provides a prison penalty for those 
found guilty of such an act. These two practices are very common 
in the clothing industry, and have been considered unfair practices 
in the trade. 

Business Ethics. Certain standards of business have been 
adopted by groups of business men which will benefit the majority 
of those engaged in that industry, but not necessarily those in the 
community or society as a whole. To illustrate : Merchants have 
been known to cancel orders for wearing apparel when prices have 
dropped. Such a policy may help the merchant temporarily, but 
it is a disadvantage to society as a whole. It is clear that such a 
standard of ethics is not correct. There is only one standard of 
ethics that has withstood the test of time — “ Love thy neighbor 
as thyself.” This can be expressed in the Golden Rule, “ Do unto 


90 


ECONOMICS OF CLOTHING AND TEXTILES 


others as you would have them do unto you/’ or in the language 
of the sidewalk merchant, “ Give every one a square deal.” Unfair 
business practices may help the merchant temporarily, but in the 
long run these practices are harmful to both the merchant and 
society in general. Each trade organization now adopts a code 
of ethics for that trade. Because of the weaknesses of human 
nature, the codes are violated by many traders in times of 
depression. 

The following illustrates the code of ethics adopted by the Silk 
Association of America with regard to the buying and selling of 
silk waste: 

The Board of Managers of The Silk Association of America, Inc., on 
request, approves the following Domestic Raw Silk Waste Rules recom¬ 
mended by the Committee on Specifications Covering Domestic Raw 
Silk Waste, to govern transactions between buyers and sellers in the 
absence of express agreements to the contrary. 

Nothing in the following specifications shall be construed as waiving the 
right in individual transactions to make any special contrary agreement, 
but the specifications shall govern in cases where no such special con¬ 
tract exists. 

Domestic waste is defined as waste produced in the process of manip¬ 
ulating raw silk as distinguished from waste produced by the reeling 
filatures. (Tussah waste not included.) Deliveries must conform to 
the requirements of these specifications. 

Classification. Long waste consists of waste commercially free from 
fibers of less than six (6) inches in length. 

Short waste consists of waste containing open fibers of less than six (6) 
inches in length. 

The burden of segregating short waste from long waste is with the 
supplier, and deliveries of long waste not conforming to these specifica¬ 
tions as to length of fiber may be paid for as short waste or returned at 
option of seller. 

Color. Colors of tinted waste must be fugitive: that is, any color 
other than the natural color of the silk must disappear completely when 
the waste is given two boiling operations of filtered water containing 
one (1) per cent of olive oil soap, the weight of the solution in proportion 
to the weight of the silk being in the ratio of 50 to 1. The coloring matter 
used must also be such that it will not be fixed by the application of acid. 

Boil-off. The boil-off, determined by the standard method applied to 
raw and thrown silk, shall not be greater than 27 per cent of the con- 


SOCIOLOGICAL BASIS OF CLOTHING 


91 


ditioned weight of the waste as delivered. The value of any excess beyond 
the 27 per cent shall be deductible from the seller’s invoice. 

Twist. Deliveries must be free from hard twist; that is, none of the 
fibers shall be twisted together with more than sixteen (16) turns of twist 
per inch, basis of two-thread ii denier raw silk. 

Knots. Deliveries must be free from weaver’s and warper’s heading 
knots, unstrung cop and spindle waste, and warp splicings. 

Foreign Matter. Deliveries must be commercially free from foreign 
matter of any description, including cotton, rayon, straw, excessive 
amount of oil, pieces of metal, etc. 

Weight. Deliveries of domestic waste shall be on the basis of con¬ 
ditioned weight: that is, absolute dry weight plus eleven (11) per cent. 
In cases of dispute, the conditioned weight of the lot shall be estab¬ 
lished by the United States Testing Company, Inc., whose report shall 
be accepted by both buyer and seller and its cost borne by the party in 
error. 

Deliveries. The acceptance of shipment by a railroad or other common 
carrier shall constitute a delivery. Each delivery shall be considered 
a separate sale. 

Rejections. The buyer must promptly inspect and test waste upon 
receipt and promptly notify seller of intention to reject any lot not con¬ 
forming with contract specifications. The buyer shall pay for waste used 
in making tests and where the right to reject has been established may 
return partial bales from which samples have been extracted. 

Where any domestic waste is rejected for proper cause, the matter shall 
be submitted to arbitration unless the parties can arrange for a replace¬ 
ment or cash allowance or make some other adjustment satisfactory to 
both parties. 

Terms. Prices are f. o. b. seller’s shipping point, payment net 10 days 
after receipt of shipment, free of exchange, in U. S. currency or its equiva¬ 
lent at the office of the seller. Where shipment has been delayed, lost, 
or destroyed in transit, 80 per cent of invoice (to which bill of lading must 
be attached) shall be paid; 20 per cent shall be paid promptly after receipt 
of shipment with allowance for reasonable time for inspection; unless 
shipment is lost or destroyed in transit, in which case this balance of 
20 per cent shall be paid in 30 days from date of invoice. Partial or 
complete payment of invoice in advance of inspection and determination 
of quality shall not relieve seller of his obligation to deliver in accordance 
with contract specifications. 

Arbitration. All disputes must be arbitrated in accordance with the 
arbitration procedure of The Silk Association of America, Inc. 


92 ECONOMICS OF CLOTHING AND TEXTILES 


Social Development of the Clothing Industry in the United 
States. The success and efficiency of the manufacture of wearing 
apparel is due in no small degree to the character of the labor 
employed. During the industrial development of the United 
States the type of labor engaged in the clothing trade has changed 
many times. With the exception of the South, the development 
of the textile and clothing industries has caused remarkable social 
changes in the sections in which they are located. At first the 
mill-workers were almost all descendants of native-born Ameri¬ 
cans, and often were the neighbors and friends of the owners. 
They were usually of English descent, whose ancestors were 
trained in textiles. In the thirteen original colonies the Eng¬ 
lish were the dominant race. They greatly outnumbered every 
other nationality and put their particular stamp on the civiliza¬ 
tion, determining not only the language but also the form of 
government. 

When the nation came into being in 1789, the proportions of the 
various white strains, as indicated by the returns of the first census 
of 1790, were about as follows : Of the 3,172,444 whites, the English 
and Welsh constituted 82.1 per cent; the Scotch, 7.0 per cent; the 
Irish, 1.9 per cent; the Dutch, 2.5 per cent; the Germans, 5.6 per 
cent; the French, 0.6 per cent; the Swedish and others, 0.3 per 
cent. With respect to color, 80.7 per cent were white, and 19.3 
per cent were colored. 

The total population increased from less than 4,000,000 in 1790 
to more than 9,500,000 in 1820. This means that the population 
increased more than 133 per cent in three decades. Conditions 
of life were extremely favorable. Birth rates were probably close 
to the maximum and death rates, on the whole, moderate. As 
industry developed, calling for more laborers, Irish and French 
Canadians came in, and with their cheaper labor took the places 
of the native born. 

Irish Immigrants. In 1820 the great Irish migration to this 
country began. Some 50,000 emigrated to the United States 
during the decade from 1820 to 1830, followed by more than 
200,000 during the next ten years. The country had begun to 
expand industrially. Because the immigrants, largely from south¬ 
ern Ireland, were mostly laborers, they were at first heartily 


SOCIOLOGICAL BASIS OF CLOTHING 


93 


welcomed. Had it not been for the Irish influx at this period the 
construction of our canals and railroads would have presented 
very great difficulties. 

In 1845 the Irish famine occurred, and this led to a great wave 
of migration to the United States. During the decade beginning 
in 1840, nearly 800,000 Irish migrated to America, and in the 
following decade the number exceeded 900,000. These immigrants 
located primarily on the eastern seaboard in New York, Boston, 
and other Massachusetts cities, and soon constituted one of the 
major elements in the growing population. They became the 
mill-workers in the textile centers. 

The German Settlers. At about this time, 1848, there started 
an almost equally important mass migration of Germans, which 
resulted from the political upheavals in the German states. Their 
influx reached a maximum of 215,000 in 1845, and their total for 
the decade 1850 to 1860 was more than 950,000. 

These immigrants were of a superior type. They were intelli¬ 
gent, educated, and self-reliant, and soon made their influence 
felt wherever they settled. They were not driven from their 
mother country by the pressure of economic conditions. With 
them, as with the original colonists, it was largely a matter of 
liberty of conscience and a desire to establish themselves in the 
new land where democratic institutions prevailed. They did not 
all settle in the large cities; many pioneered into the open western 
areas, settling along the Ohio and Mississippi valleys, forming 
large, progressive, and prosperous communities at Cincinnati, 
St. Louis, and other places.. From the very beginning they en¬ 
riched our professional and industrial life, particularly the textile 
industry, with chemists, dyers, and inventors of textile machinery. 

There was a sharp falling off of immigration during the Civil 
War. But afterward it revived, attaining in the single year 1882 
a peak of nearly 789,000. That year was a landmark in the annals 
of American immigration. It witnessed the crest of the German 
wave as well as that of the Scandinavians, who were attracted to 
the broad, fertile farmlands of the North Central States shortly 
after the close of the War. In that year, also, the first Chinese 
Exclusion Act was passed and the first inclusive federal immigra¬ 
tion law was enacted. 


94 ECONOMICS OF CLOTHING AND TEXTILES 


Up to this point the bulk of the arrivals were from Great Britain, 
Ireland, Germany, the Netherlands, and the Scandinavian coun¬ 
tries. Throughout the first eight decades of the century the broad 
ethnic composition of the American population had not changed 
greatly through the accretion of the several racial groups. These 
several peoples looked very much alike. They spoke either Eng¬ 
lish or an allied tongue. Their social institutions were similar, 
making their assimilation into the flesh and blood of the new 
country relatively easy. 

In 1890 the foreign stock — that is, the sum of the foreign-born 
and first-generation natives — constituted nearly 21,000,000, or 
32.8 per cent of the total population. As we might expect, the 
British, Irish, and Germans constituted nearly 70 per cent of the 
total foreign stock. 

Progressive Changes. The development of the mills required 
more capital. This required the sale of more stock, which natu¬ 
rally went to outsiders — resulting gradually in absentee ownership. 
The employees and stock owners became strangers to one another, 
and the fine cordial relations between mill owners and workers that 
existed in the early development of the textile industry disappeared. 
Many labor troubles due to misunderstandings arose and caused 
much suffering among the laborers. 

Due to the great development of the textile industries there was 
a demand for more labor. Automatic machinery was invented 
which caused much discontent regarding labor and wage conditions 
because of disputes with the absentee owners. The latter made 
an effort to eliminate many of the English and Irish workers and 
to replace them with workers from countries having a lower 
standard of living. Since the wage standards are lower in Italy, 
Syria, etc., because of the habits and customs of the people, 
there was a tendency for manufacturers to encourage people from 
such countries to emigrate to America and seek work in the 
textile mills. 

Thus the Irish were gradually driven out by immigrants from 
Poland, Russia, Bohemia, and Syria, who were unfamiliar with 
American standards of living and were content with very low 
wages. These later immigrants were largely of an agricultural 
class and did not contribute by inventiveness and applied science 


SOCIOLOGICAL BASIS OF CLOTHING 


95 


to the development of the textile industry to the same extent as 
the English, Irish, French, Swiss, and Germans. 

Serious problems of many kinds — social, political, and economic 
— resulted from the inability of most communities to assimilate 
the deluge of new arrivals. There crystallized a general public 
opinion to the effect that the new immigration was on the whole 
a mistake and constituted more or less of a menace to our type of 
civilization. The result of several legislative efforts was the Im¬ 
migration Law of 1924, which limited the annual number of new¬ 
comers. Later, in 1929, the national origins provision of the Act 
limited the immigration under the quota to 153,000 annually. 
The immediate effect of this law was radically to restrict the flow 
of immigration from eastern and southern Europe. 

Today, immigration to the United States has virtually ceased, 
the number of those leaving the country being greater than those 
entering. The migration era has been brought to a definite close. 

Each country has made a contribution to the development of 
American industry, either in the agricultural, manufacturing, 
artistic, scientific, or business life. To illustrate: The Jews have 
contributed to trade and banking, and the Teutonic races to machin¬ 
ery and applied science. The French and Japanese have such a 
high artistic sense that their products are works of art. 

The English and Americans have intensely practical minds and 
constantly emphasize usefulness, convenience, speed, economy 
of production, and not beauty, because they feel that the useful¬ 
ness of producer goods depends upon efficiency in the industrial 
stages of the production of the commodities. 

The Germans with their patience and mechanical ability have 
contributed much to the manufacture of dye-stuffs, finishing ma¬ 
chinery, etc. 

Effects of Mixed Population. The textile mills and factories in 
other countries have a purely native working population with the 
| same racial traditions, points of view, and standards of living, 
j Therefore the factories and mills in the United States are at a dis- 
1 advantage. To illustrate: At present one of the best organized 
f mills with 4000 employees has more than fifteen nationalities rep- 
I resented in the working force. The approximate distribution by 
racial groups is shown in the following table: 


96 


ECONOMICS OF CLOTHING AND TEXTILES 


American. 

Irish. 

Italian. 

German and Austrian. 

Swedish. 

Polish. 

All others (chiefly English, Scotch, French, 


46 per cent 
18 per cent 


9 per cent 
6 per cent 
5 per cent 
4 per cent 


Russian, Swiss, and Canadian) 


12 per cent 


Of the office force, 86 per cent are American, 9 per cent are Irish, 
and the balance chiefly Scotch and English. 

The distribution of the working force by nativity is as follows: 


American born of American parentage.13 per cent 

American born of foreign parentage.33 per cent 

Foreign born of foreign parentage.54 per cent 


For the clerical force these percentages are 22 per cent, 64 per cent, 
and 14 per cent. 

Approximately 60 per cent of the total personnel are men. Of 
these, 68 per cent are married, 29 per cent are single, and 3 per cent 
are separated from their wives by death or divorce or for other 
reasons. Of the women, who constitute 40 per cent of the total 
working force, 60 per cent are single, 35 per cent are married, and 
5 per cent are widowed, separated, or divorced. 

The age distribution of workers in the entire force is approxi¬ 
mately as follows: 

16 to 20 years.11 per cent 

21 to 30 years.29 per cent 

31 to 40 years.28 per cent 

41 to 50 years.17 per cent 

51 to 60 years.10 per cent 

61 to 70 years. 4 per cent 


All other ages 


1 per cent 


Age distribution by sex shows that approximately 41 per cent 
of the women and only 16 per cent of the men are under twenty- 
five years of age, while 13 per cent of the women and 26 per cent 
of the men are over forty-five years of age. The average of men 
office-workers is thirty-one and that of women office-workers 



















SOCIOLOGICAL BASIS OF CLOTHING 97 

twenty-eight years. Age distribution by sex in the office group 
is approximately as follows: 

Age Men Women 

16 to 25 years.28 per cent.45 per cent 

25 to 35 years.42 per cent.33 per cent 

35 to 40 years.23 per cent.16 per cent 

40 to 50 years. 4 per cent.3 per cent 

Over 50.* . . 3 per cent.3 per cent 

The average length of service of men employees is 13.9 years, 
and women, 9.5 years. Twenty-three per cent of the men em¬ 
ployees and 13 per cent of the women have had 20 years or more 
of service, an unusually high proportion of long-service employees. 
Fifty-three per cent of the men and 34 per cent of the women have 
been with the company for ten years or more, and 77 per cent of 
the men and 61 per cent of the women have been there for five or 
more years of service. 

A Present Problem. The development of new machines for 
making wearing apparel and new methods of preparing raw and 
semi-raw materials for this purpose have continued at a rapid 
rate during the last century, particularly during the last decade 
or two. These new devices and methods have constantly dis¬ 
placed workers. While years ago these displaced workers found 
new employment in newly created fields of endeavor, the increase 
has been so large of late that other fields have been unable to 
absorb them. Hence there are more people unemployed in the 
wearing apparel trades than there are positions, and other fields 
can not take care of the unemployed. The problem of taking care 
of these idle employees is one of the pressing ones of the time. 

Since industry exists for society and society must provide work 
for its members, it becomes necessary to rearrange industrial 
methods so that all workers may find employment. This can be 
done by distributing the work so that each worker will be employed 
five instead of six days and if each day be reduced in length to 
six or seven hours, with no night work. This readjustment will 
give workers more leisure for their betterment. 

The Malthusian Theory. A study of the growth of nations 
shows that the population tends to increase in geometrical ratio, 
while the food supply increases in arithmetical ratio, and unless 












98 


ECONOMICS OF CLOTHING AND TEXTILES 


the increased population is cut down by famine, wars, or the lower¬ 
ing of the birth rate, there comes a time when the country can not 
produce the food supply necessary for the increased population. 
This is true in Italy, Japan, etc., where every year hundreds of 
thousands must migrate to other fields. Of course new means of 
food supply, utilization of farms, and conservation of natural 
resources may tend to provide greater food supply, but nevertheless 
a rapid increase in population means that eventually new land 
must be secured for the excess population. 

A political economist named Malthus defended this theory that 
the population tends to increase more rapidly than the food supply. 
His conclusion was based upon the following observations : (1) the 
population increases in a geometrical ratio; (2) the law of dimin¬ 
ishing returns applies to the soil; that is, the return from the soil 
(the food supply) increases less rapidly than the number of workers 
on the soil. To illustrate: If nine men are placed to work on a 
given area of land the return (food supply) will not be nine times 
as much as the food supply when one man tills the same area. 
This theory is called the law of diminishing returns. 

Of course, it is necessary to remember that the earth is limited 
in area, and that Nature’s resources, however plentiful, are not 
boundless. Certain sections, even, may have reached population 
saturation, a condition that if true will usually be found attribu¬ 
table to poor government, backward agriculture, and other causes, 
rather than to a poverty of natural resources. But there is no 
evidence in this country that the soil from which man derives his 
sustenance is groaning under its human load. Increase in popula¬ 
tion during recent decades has been rapid, but the world’s food 
production has been increasing at a still more rapid rate. The 
Year Books of the United States Department of Agriculture tell 
us that whereas food staples, such as wheat, oats, etc., increased 
between 40 and 50 per cent from 1895 to 1912, the increase of 
population for the same period was only a trifle over 25 per cent. 
Many people today have a vague feeling that the means of sub¬ 
sistence are less abundant than formerly. But this idea is due 
chiefly to the higher cost of life’s necessities, caused primarily by 
the rapid rise in the cost of marketing and not by a decrease in 
the world’s food production. 


SOCIOLOGICAL BASIS OF CLOTHING 


99 


Overpopulation in the Future. But what of the future? Is 

there danger of overpopulation? Experts show us that the earth, 
cultivated by ordinary agricultural methods, could support more 
than sixteen times its present population. This figure could be 
indefinitely increased by intensive cultivation and by the progress 
of inventions. We must remember that “ Necessity is the mother 
of invention.” The problem must arise before mankind will 
solve it. The danger of overpopulation, however, with which 
the Malthusians would frighten us, is not as serious as it would 
seem on first thought. 

Underpopulation. If there is anything to fear, it is the danger 
of underpopulation. Confining our attention to the United States 
under the existing death rate, it requires an average of close to 
four children per family to keep the population stationary. 

A high birth rate does not imply a high death rate according 
to the Malthusians. To illustrate: In England and Wales, a 
low birth rate coexists with high infant mortality; whereas, in 
Ireland the reverse is true. There they have a high birth rate 
and a low infant mortality. Reliable data show that with due 
allowance for cases of extreme poverty, with good care and nursing 
and with proper spacing between births, it has been found that 
the mothers who raised the largest number of children were those 
that lived the longest. The French Canadians have very large 
families and live to a good old age. 

In order to have well-developed families, — the normal unit of 
society and community life, — it is necessary to see that the father 
has a living wage that will support a good-sized family in a frugal 
manner. 

Very careful calculations in the year 1932 show that it costs 
$9000 for a family with an income of $2500 to rear a city child 
from birth to 18 years of age. This high cost of rearing children 
in the cities is now worrying economists as well as urban parents. 

The trend to a stationary or decreasing population is manifest 
not only in the United States but almost everywhere in the Occi¬ 
dent. It has been predicted that America will have a stationary 
population in 1960. 

Dr. Oliver E. Baker, economist of the Department of Agriculture, 
whose special study is the relation of population to land utilization, 


100 ECONOMICS OF CLOTHING AND TEXTILES 


says the decline is definitely associated with industrial development 
and city life. As the chief reason for the relative scarcity of chil¬ 
dren in the cities he cites the recent survey mentioned above, 
which was made by an insurance company. “ It requires about 
three children a family to maintain even a stationary population, 
and it appears that for a typical American urban family to raise 
three children it will cost $25,000 to $30,000,” he said. 

Dr. Baker points out that urban conditions of living very often 
are not favorable to family life. In the urban industrial system 
there is little place for the child. In many cases the individual, 
not the family, is the economic unit. 

On the other hand, not only can the child be raised more cheaply 
on the farm, but in most cases he is an economic unit from the age 
of ten years onward. 

Birth Rate in the United States. Reliable figures indicate that 
there were about 150,000 fewer births in 1931 than in 1930. The 
decline of births in a year of economic depression was apparently 
two to three times as large as the average annual decline during 
the preceding decade of urban prosperity. Some hope of retarding, 
if not stopping, the decline is afforded by the movement of profes¬ 
sional and business men and of factory workers to suburban places 
and small farms. The prospect, at present, is for an increase of this 
movement, but as yet the influence on the birth rate is not large. 

Vocational Industrial Education may be justified on the grounds 
that a democracy means equal opportunities for all, that every 
one within reasonable bounds of age, health, and strength should 
be engaged in a useful occupation, that is, all persons of both sexes 
not incapacitated or in school should be working. Practically 85 
per cent of the present workers — those who work for pay — are 
engaged in producing concrete material; of the remaining 15 per 
cent about 5 per cent are engaged in professional service; the other 
10 per cent are engaged in various forms of personal service. Life 
and health, and to a large extent discipline and character, must be 
derived from employment in the industrial and commercial fields. 
Any large number of men and women without training for some 
definite occupation, and not able to be producers, are apt to be¬ 
come a heavy burden on society, and often form a discontented 
class that threatens the existence of our government. Society 


SOCIOLOGICAL BASIS OF CLOTHING 


101 


must provide means and training for the proper distribution of 
human talent, in order that every member may be assured of a 
living wage or salary. 

The efficiency of society means the welfare of the group, which 
can be best accomplished by (1) strong and reliable government 


BECAUSE OF GREATER EXPENSE OF 

REARING CHILDREN, FAMILIES ARE 

SMALLER in CITIES THAN in RURAL AREAS. 
For example: 

AVERAGE SIZE OF FAMILIES— 

NEW YORK 
(Largely urban) 

1910 1 4.5 | 

1920 | 4.3 1 

1930 I 4 | 


Thus the movement of 
Population to Cities is 
lowering U. S. Birth Rate. 


Chart Showing How America’s Families Are Growing Smaller 

service, (2) laws that are just to all, (3) opportunity for each to 
develop to the best of his ability, (4) efficient organization of the 
group — loyal workers with proper leadership, (5) each allowed 
a chance to select a vocation that offers opportunity for service and 
advancement, (6) a training for the vocation that will prepare 
him for the development of his highest ability either as worker or 
leader, (7) each individual to be allowed to enjoy the companion¬ 
ship of his friends and family, and to be contented. 


NORTH CAROLINA 
(Largely rural) 

1910 I 5 I 

1920 1 5 | 

1930 1 4.9 | 


AVERAGE SIZE OF 
FAMILIES FOR U.S. 

1910 | 4.5 1 

1920 1 4.3 1 

1930 1 4.1 | 



























102 ECONOMICS OF CLOTHING AND TEXTILES 

The study of the economics of clothing has a distinct ethical 
value because it broadens one’s sympathies so he can see the rela¬ 
tion between the workers, the employees, and the consumers, and 
can see better how each class can be rendered happier and more 
efficient. 

A nation is making economic progress if the labor of its citizens 
produces greater wealth. This may be due to (1) new inventions 
— machinery or processes, (2) better living conditions and higher 
standards of life, which improve their health and give them greater 
ability, or (3) better training of workers through vocational educa¬ 
tion and the teaching of better organization to leaders. 

QUESTIONS 

1. What is the relationship between sociology and clothing? 

2. What effect has immigration on social conditions ? 

3. How has the depression “socialized” economic thought? 

4. Members of society in all countries have realized the value of 
attractive dress. How has this been illustrated in certain countries? 

6. How has the caste system affected dress? Wffiat effect has that 
idea had on jobs in this country? 

6. How do the fan and the handkerchief illustrate social changes? 

7. What has culture mass to do with one’s choice of clothing? Name 
contributions made by various countries. 

8. Some consider the wearing of clothes the result of climatic condi¬ 
tions. Is this wholly true? 

9. How did the word wife originate? Spinster? 

10. Civilization has overcome primitive inertia. Illustrate from the 
clothing industry. 

11. Modern communication has standardized clothing. Explain. 

12. Account for the “sweat shop” practice. 

13. Trace the development of the clothing industry in the United 
States, noting the effect that labor has had on the industry. 

14. How can society meet the problem of the unemployed who have 
been thrown out of work by machines? 

16. Criticize Malthus’ theory. How may this problem be met? 


CHAPTER IV 

CONSUMPTION OF CLOTHING AND TEXTILES 

Definitions. The process of wearing out an article of clothing, 
or robbing it of its usefulness, is called the consumption of the 
article. Thus the total consumption of clothing by society is 
measured by the quantity of wearing apparel used. The process 
of consumption may be considered from two points of view: 
(1) the wearing out of a silk shirt is an example of final consumption 
because the silk can not be used again for clothing; (2) the utiliza¬ 
tion of a worsted suiting into shoddy to be used for remanufactured 
wool is an example of partial consumption. In the latter case the 
wool will be used again. In other words, consumption is the wear¬ 
ing out of an article for the satisfying of a human need. 

Waste is an economic term used to indicate the destruction 
of the utility of an article without satisfaction to the consumer 
and without assisting in the production of other goods. Thus 
the loss of a wool suit through fire would be considered eco¬ 
nomic waste. 

Importance. The consumption of textiles is very important to 
the individual because of the large amount of one’s earnings 
(10 per cent to 25 per cent) often spent on clothing and textile 
house-furnishings. A saving of 9 per cent or more means that 
this sum may be used for savings and other purposes. In order 
to be economical in this respect, it is necessary for the consumer 
to know how to select and to buy different kinds and qualities of 
textiles, how to recognize the ones best adapted to his use, and 
how to obtain the greatest service from the fabrics and wearing 
apparel purchased. 

Economics for the Consumer. In order to avoid waste, partic¬ 
ularly in wearing apparel, we must have efficiency in production 
and exchange as well as the proper selection, purchasing, and 

103 


104 ECONOMICS OF CLOTHING AND TEXTILES 

conservation of clothing. Great emphasis has been placed on 
production, and to some degree on exchange (marketing), but 
little if any emphasis has been placed on the proper kind of clothing 
for the individual, for various purposes such as climatic, social, or 
economic, at reasonable prices, or on the ability of the consumer 
to conserve the clothing purchased. 

A study of the economics of clothing should be part of every one’s 
education, particularly that of girls and women, who are the 
spenders of income, especially for clothing. Economics of clothing 
should include a study of: (1) the amount to be spent for clothing; 

(2) the proper selection of clothing, which in turn involves a 
knowledge of textiles and the elements that make clothing beautiful 
— lines, color, artistic value of the human form, style, and fashion; 

(3) how to judge values and to buy clothing; (4) the conservation 
of clothing; and (5) the need of cooperation between consumer, ex¬ 
change agent, and producer in order to meet effectively the needs 
of the public with regard to clothing. 

Wasteful consumption means the production of luxuries to 
satisfy the whims or fancies of certain people. Such consumption 
causes a reduction in the production of the necessities of clothing. 

Utility of Clothing. In Chapter I we found that a demand for 
clothing or wearing apparel is a human want plus the ability and 
willingness to pay the price. The clothing, wearing apparel, or 
other commodity or service that satisfies the want is called a 
utility. In the popular sense, utility may mean something useful, 
but in strict economic use it is the power to satisfy a definite want. 
Consumption is destruction of these utilities in order to satisfy 
wants. To illustrate : When a person has worn threadbare a silk 
blouse, she has enjoyed the elementary, form, time, place, quantita¬ 
tive, and possession utilities in the silk blouse, and at the same 
time destroyed them. 

The economic life of a commodity is the time it retains its utility 
and therefore is in demand. The economic life of an overcoat be¬ 
gins in the late fall and winter, hence the price is lowered in March 
or April, when the economic life is nearly or completely over. The 
economic life of a particular overcoat may be extended over two 
or three winters, of course, but it has no utility during the inter¬ 
vening summer months. 


CONSUMPTION OF CLOTHING AND TEXTILES 105 


Marginal Utility of Clothing. In order to understand the forces 
that determine the price of wearing apparel, it is necessary to con¬ 
sider the elements that make up the value of clothing. 

Marginal utility, we learned, is the utility of a single unit — a 
single skirt or a single suit — as determined by the amount of the 
supply at hand. If a person has twenty suits of clothes, the mar¬ 
ginal utility of the last suit would be much less than if he had only 
two suits of clothes. When the number of suits far exceeds any 
possible needs of a consumer, the last suit possesses no marginal 
utility whatever. 

The utility of an article like a silk shirt is often called subjective, 
because its value is largely dependent on the amount of satisfaction 
it will give the consumer rather than on the amount of wear he 
can obtain from it. The consumer will not pay more for the silk 
shirt than its subjective value to him, hence that value is the max¬ 
imum exchange value of the shirt. 

Consumers may be divided into at least three classes: the 
wealthy, the middle class, and the poor. The wealthy value 
money less than the other two classes and hence are willing to pay 
a little more for the same article — such as shoes. The number 
of pairs of shoes they will buy will depend more upon their tastes 
than upon the price of the shoes. Unlike the middle class and 
poorer class purchasers, they will not buy more shoes because the 
supply increases and the prices are slightly lower. 

Thus we find that each community pays for certain articles 
according to its ability. Articles of wearing apparel, like handker¬ 
chiefs or dress accessories, may sell for 10 cents in a small com¬ 
munity. Wearing apparel or dress accessories to serve the same 
purpose might sell for $1.00 in a wealthier community. In other 
words, the richer the community the higher will be the price of the 
monopolized wearing apparel or dress accessory. 

Marginal Consumer. The consumer who is least anxious to buy 
a commodity, either because he has not the desire or because his 
purchasing power is low, is called the marginal consumer. He is 
constantly looking for a low price; if the price of a silk dress goes 
up, he will look for a cheaper substitute. As the price of the silk 
dress goes up he is no longer a marginal consumer. Some one 
else who is willing to pay the additional price becomes the marginal 


106 ECONOMICS OF CLOTHING AND TEXTILES 


consumer. On the other hand, if the price of the silk dress went 
down, another marginal consumer would appear. Thus we have 
a marginal consumer for each price. Any change in the price 
changes the quality and rank of the marginal consumer. 

Hence a change in the price of wearing apparel or any other 
commodity will naturally bring about a change in the demand for 
it. Lowering the price of silk dresses brings in another group of 
customers. An increase in price excludes a group of customers. 
Lowering the price should thus increase the sales. 

The marginal consumer is an important factor in the selling of 
wearing apparel or any other commodity. It is the group to which 
the advertising is expected to appeal. A good advertisement should 
hold the marginal consumer at the existing price, and also appeal to 
those just below the marginal consumer class who appear indifferent. 

Marginal Producer. While the demand for clothing and wear¬ 
ing apparel comes from the consumer, one would naturally suppose 
that he might be in complete control of the price. But the con¬ 
sumer has strong desires for wearing apparel and seeks to satisfy 
them. The producer of wearing apparel knows the existence of 
these desires of the consumers and produces the apparel and 
charges a price that will give him a satisfactory return for the 
materials, labor, services, etc. 

Since the cost of producing wearing apparel differs among pro¬ 
ducers according to the management and efficiency of the factories, 
it follows that the producer whose costs are lowest can sell at the 
lowest prices without loss. On the other hand, the producer whose 
costs are highest and who is yet able to sell his wearing apparel 
is the one who determines the market value or price. He is called 
the marginal producer, because he is on the edge or margin of 
production. He is the one who demands the highest price, because 
he is the one least anxious to sell. 

Both the marginal consumer and marginal producer are impor¬ 
tant factors in the buying and selling. They constitute those 
great groups that argue with one another with regard to unfair 
trade prices. They are always looking for bargains, running from 
one store to another, comparing prices, accusing merchants of 
robbing the poor consumers. They are a constant annoyance to 
the peaceful arrangement of buying and selling wearing apparel. 


CONSUMPTION OF CLOTHING AND TEXTILES 107 


Consumer’s Surplus. We have already observed that the mar¬ 
ket price is the product of a number of forces and conflicting in¬ 
terests, chief of which are the marginal consumer and the cost of 
production. The price or exchange value of wearing apparel in 
the market tends to be the price that will attract the marginal 
consumer, and is not an average of the prices the various purchasers 
are willing to pay. There are always some consumers who would 
have bought the same article even if the price had been higher. 
Since it has not been necessary to pay this higher price they receive 
a certain surplus satisfaction called the consumer’s surplus. To 
illustrate: A rich man and a poorer man purchase the same kind 
of a handkerchief. The poor man is the marginal consumer who 
would not have bought the handkerchief if its price had been raised. 
Its value to him, in terms of money, was exactly the price paid. 
The rich man, on the other hand, might have been willing to pay 
a considerably larger sum for the handkerchief. He valued his 
money less highly because of the amount he possessed, and would 
pay more for the gratification of his desire. In other words, the 
value of the handkerchief to him was greater than the value of 
the money paid for it. The difference between the two values is 
called the consumer’s surplus. 

Price Groups in Clothing. Textiles, including raw materials 
and raw cloth, as well as clothing and other wearing apparel, may 
be purchased at so-called “ high prices,” “ lower prices,” and 
“ medium prices.” 

The expression “ high-priced wearing apparel ” is frequently 
misunderstood by many people. The difference between high, 
medium, and low-priced clothing is due to various values in ma¬ 
terial, workmanship, and service. In many if not most cases it 
is not a matter of one merchant charging a high price for the same 
quality that can be bought elsewhere for a low price and equal or 
better service. 

High-priced wearing apparel should mean the finest in quality, 
and embodying many important items of cost in production that 
are essential to the standard or seal of excellence, such as (a) high 
quality of raw materials, ( b ) high grade workmanship or crafts¬ 
manship, (c) intelligent service, ( d ) business courtesies, and 
(e) confidence in the merchandise and the seller’s manner of doing 


108 ECONOMICS OF CLOTHING AND TEXTILES 


business. These items are not demanded in the less expensive 
clothing when the people buying the article are able to discriminate 
between qualities. The purchaser should carefully analyze the 
quality and services of all wearing apparel and see why certain 
articles are above medium and low prices. Sometimes the high- 
grade or quality articles, though necessarily costing more, are in 
reality not as expensive as a cheaper grade at a lower price. 

In the purchase of wearing apparel we may think of one or more 
of the following characteristics: (a) style, (6) quality, (c) work¬ 
manship or tailoring, ( d ) value, ( e ) price, (/) service. 

Of course all consumers do not consider all of the above char¬ 
acteristics in the purchase of clothing. Some consumers look for 
the style, that is, the cut, line, color, etc., that is recommended by 
the costumers or manufacturers. They may look for style, regard¬ 
less of quality, service, or workmanship. The group that demands 
style may be considered as (a) ultra, ( b ) exclusive, (c) popular, 
( d) conservative, (e) staple. The ultra group demands the 
newest and the most attractive, that is, really the extreme, and 
the one that will cause people to look at them as they pass by. The 
exclusive style is demanded by those who can afford to pay the 
highest price and who know that the style is not common but is 
used only by those of extreme wealth. The popular style is one 
that is in demand by most people. The style that has the least 
change from the previous season, that will not attract attention 
is called conservative. A staple style is one that can always be 
worn, such as a broadcloth suit. 

Quality refers to the best wearing apparel in both composition, 
finish, and workmanship. Quality clothing always stands out as 
superior, and of course costs the highest. 

Tailoring or workmanship refers to the method of manufacture, 
the way the garment is put together by hand or machinery or both. 
Hand tailoring gives, in some cases, better results than machine 
work. 

Value. Value refers to the qualities in wearing apparel that 
make it very desirable. The more desirable qualities it possesses, 
the greater the value. Every article of wearing apparel is made 
or designed carefully for a definite purpose. These qualities of 
design, called the specifications, indicate the value of the article. 


CONSUMPTION OF CLOTHING AND TEXTILES 109 


The price is the value expressed in dollars and cents. To some 
people with limited income, price is a very important factor, in 
fact in some cases it is the most important factor. 

Value has been defined as the combination of quality and price. 
The term can be applied equally as well to the cheaper articles as 
to the highest-priced items, but it has been often confused as 
meaning only a so-called high-grade product selling for a low price. 
A low-priced product may represent an excellent value when the 
materials and design have been carefully selected for their purpose 
and the proper workmanship added to complete a worthy article. 

Service refers to the many things that are done to make the 
consumer feel at ease, such as comfort while shopping, quick 
delivery, as well as extending to the consumer easy terms of pay¬ 
ment, etc. 

Wholesale and Retail. The purchase of wearing apparel may 
be by wholesale or retail. The purchase by wholesale is in large 
quantities and involves greater knowledge of the wearing apparel 
than by retail. The prices of wearing apparel fluctuate from day 
to day, and the efficiency of the buyer depends upon his ability to 
secure the lowest price. 

Purchase by retail is in small quantities to meet the immediate 
needs of the consumer. Consumers vary in their ability to buy. 
One may divide consumers into the following classes: (a) those 
who demand quality, style, and service without regard to price, 
(6) those that demand quality, style, and service at the lowest 
price, (c) those that demand quality and style regardless of service 
at the lowest price, (d) those that demand quality regardless of 
style, (e) those that demand style regardless of quality at the 
lowest price, (/) those that demand lowest price regardless of 
quality and style. 

Since there are different types of consumers, there must be 
different types of business firms dealing in wearing apparel, each 
one appealing to certain types of consumers. 

Some consumers demand service and quality, regardless of price. 
Other firms provide goods of the same quality at lower service and 
at lower prices. In addition, there are many firms that sell goods 
of varying quality at still lower prices. This last type of merchant 
appeals to the marginal consumer whose wants are less intensive 


110 ECONOMICS OF CLOTHING AND TEXTILES 


and who usually visits and inspects the wearing apparel of at 
least three stores, and compares the prices. That is the reason 
why one finds at least two or three retail dry goods stores in every 
city. Women shoppers demand the right to make comparisons of 
the prices of the same wearing apparel in two or three stores be¬ 
fore they make a purchase. 

Need of Cheap Wearing Apparel. Each article of wearing 
apparel gives not only a certain material satisfaction to its owner 
but also has a certain psychological value. Thus a fur coat not 
only keeps one warm but also affords a feeling of satisfaction in 
having it. There is a certain thrill received from wearing a 
Russian sable coat that one does not receive from any other style 
of coat, even though it may keep one’s body just as warm. 

A fur coat may be composed of (a) the best Russian sable, 
( b ) a medium grade Russian sable, (c) low-grade pieces of Russian 
sable, ( d ) imitation Russian sable fur, or (e) cloth imitation 
Russian sable. These five grades of coats may be made to appear 
to the average person very similar but may vary in cost from $250 
to $2000. 

Some consumers are willing to pay the highest price for the 
genuine sable coat. There are others who are willing to purchase 
the imitation fur and will receive as much satisfaction from it as 
the first group of purchasers receive from the genuine sable. Con¬ 
sumers vary in taste and in discrimination. So long as they 
believe they are wearing a sable coat they receive the psychic 
value. It matters not where the coat has been purchased or the 
price paid for it. The more discriminating purchasers are insist¬ 
ent upon the genuine article and would receive no satisfaction from 
a cheap imitation. 

Because of these differences in taste and in income, there are 
manufacturers ready to place on the market at least four different 
grades of each kind of wearing apparel. These different grades 
have distinct economic value because they make it possible to give 
satisfaction to people who are unable to pay the high price for 
the best quality — i.e., the genuine sable coat — yet at the same 
time desire to have the thrill of thinking they are wearing a sable 
coat and of impressing their neighbors and friends by possessing 
one. 


CONSUMPTION OF CLOTHING AND TEXTILES 111 


The same reasoning may be advanced for the manufacture of 
weighted silk fabrics. It permits people with limited income to 
have the satisfaction of wearing silk when they can not afford to 
purchase pure dye silk. In the same way one can explain the 
demand for cotton-backed silk linings, remanufactured wool over¬ 
coating, imitation silk hosiery, and silk hosiery with cotton tops 
and feet. 

Leather. Imitation leather is used extensively in shoes and in 
accessories such as handbags, gloves, belts, etc. Genuine leather 
is obtained from the hides of animals or occasionally from fish 
skins. A cheaper product can be made by using imitation leather. 
Thus a relatively cheap leather may have the grain of a more 
expensive leather stamped on it. Pig skin may be imitated by 
embossing sheep skin, which is very cheap; glazed kid may be 
imitated by stamping the grain on a cheaper goat or sheep skin. 

Pocket-books and handbags have been made available at very 
low prices by substituting cloth sized to the proper stiffness and 
then embossed with the grain of genuine leather. 

Jewelry. Jewelry is an important part of the costume because 
of the satisfaction that it yields to the wearer, as well as because 
of its ornamental quality. Many men and women have a real 
love and passion for jewelry, either with or without precious stones. 
The precious metals used for jewelry are gold and platinum. Silver 
is used for jewelry in some countries. These metals are expensive 
and can be purchased very rarely and in but small quantities by 
the poor. Hence about the only real jewelry owned by them is 
something very highly prized, such as a wedding ring. 

The same is true with regard to precious stones, such as dia¬ 
monds, pearls, and rubies. Less expensive, *but by no means 
cheap, are the semi-precious stones, such as turquoise, opal, moon¬ 
stone, etc. 

Jewelry changes in style rapidly, both as to material and settings. 
Gold is popular at one time, platinum at another. Brilliant 
finishes and stones may be fashionable at one period and dull 
effects at another period. Jewelry changes in shape, composition, 
color, luster, etc., to agree with the prevailing style of the rest of 
the costume. Since it has both style and social value, there is 
naturally a desire on the part of every one to possess more or less 


112 ECONOMICS OF CLOTHING AND TEXTILES 


jewelry. As most people can not afford the genuine metals and 
stones, we find many substitutes developed, such as alloys, quartz, 
glass colored and stained, etc. These appear on the market and 
may seem to the undiscriminating quite as valuable as the real 
article, and may yield just as much psychic satisfaction. Such 
imitation jewelry has a distinct economic value because it gives 
to those of limited means a satisfaction that is almost as profound 
as the satisfaction afforded the wealthy by their genuine jewelry. 

Normal Prices. Prices may be considered as (a) normal, 
(i b ) inflated, or (c) deflated. They are considered normal when 
there is a maximum production and consumption, that is, full 
employment of equipment and labor and full consumption of the 
commodity, such as cotton. An inflated price of cotton would 
be due to a scarcity, with the demand exceeding the supply. The 
scarcity might be caused by poor crops due to ravages of insects 
or to unsatisfactory weather. A deflated price of cotton is due to 
an overabundance, such as existed in 1931, when the demand is 
limited and the full equipment and labor are not utilized. The 
normal price in a strict economic sense is the cost of production by 
the marginal producer, and is the market price. The market price 
may be inflated or deflated. 

The United States government has attempted at different times 
to stabilize the price of cotton, and the Japanese government has 
attempted to stabilize the price of silk. Neither has been success¬ 
ful. The government may urge the banks to be liberal in extending 
credit to farmers and merchants and thus assist price stabilization 
to some degree, but specific attempts at control have not been 
effective. Temporary control as in 1933 has been used effectively 
to hasten the return of the country to normal condition and to 
eliminate unemployment and distress. Out of these experiences 
may come some form of government control. 

Variations in Price. The price of clothing or any other article 
tends to fall when the supply is increased or when the demand for 
the article decreases. For example, at the beginning of a style 
season we pay more for clothing than at the end of the season, 
because the demand is greatest at the beginning and least at the end 
of the season. Hence “ bargains/’ or clothing at reduced prices, 
are found at the middle or end of the season. The price we pay 


CONSUMPTION OF CLOTHING AND TEXTILES 113 


for an article is called the initial price. The full price includes 
what the article has actually cost us for repairs, cleaning, etc., 
during its life. Therefore, in the purchase of this utility we must 
compare the different articles of clothing, considering not only 
the initial price, but approximating the total or final price. 

Many people feel that extravagance in dress may be justified on 
the ground that it places money in circulation, thus giving other 
people employment. But in order to benefit the community, and 
therefore the individual, to the highest degree, money should be 
spent for the things that give the greatest return — the necessities 
or the important wants of man. 

The consumer determines what kind of clothing or wearing 
apparel shall be made. The amount one spends on clothing is 
called the purchasing power of that consumer in clothing. Of 
course, the consumer may be educated to some extent by advertis¬ 
ing in the daily paper and fashion magazine, or by skillful sales¬ 
manship on the part of the salesman or saleswoman and thus be 
made to increase his purchase of clothing. 

Customary Prices. Consumers cultivate the habit of associating 
definite prices with certain necessities, like a spool of cotton, cloth¬ 
ing, etc. Thus a spool of cotton is always associated with the 
price five cents. This usual or associated price is called the cus¬ 
tomary price, and because it has stood the test of time it is con¬ 
sidered the proper price. Such prices do not vary quickly from 
season to season or with changes in demand. 

When business slackens and a real depression sets in, as in 
1930-1932, it is difficult to sell goods, particularly wearing apparel. 
Merchants in order to “move” their stock have “liquidation 
sales” and lower the price to cost and sometimes below cost. 
There are real bargains in the first liquidation sales. But as time 
goes on, the public desire lower prices and the standard manu¬ 
facturer can not lower the price and produce standard quality. 
Hence a group of sub-standard manufacturers start producing 
wearing apparel, not up to a standard but at a lower price. This 
means wearing apparel of lower quality. While one may save 
some pennies on the lower price wearing apparel, it is not econom¬ 
ical from the standpoint of service and satisfaction, fit and dura¬ 
bility. 


114 ECONOMICS OF CLOTHING AND TEXTILES 


Changes in Price Levels; Index Numbers. Notice the prices 
of textiles such as cotton fabrics as listed in the daily trade papers, 
and note how the prices change from day to day and also during 
the same day. 

General level prices are not stationary; they rise or fall, as the 
demand and supply operate inversely. These changes are indi¬ 
cated by index numbers. To illustrate : Assume that on a certain 
date, Jan. 1, 1931, the index number is 100 and on a certain date 
later the index number is 125. That means the price level has 
gone up, which in turn means that it takes more money to buy a 
given quantity of cotton or any other commodity. The pur¬ 
chasing power of money, so far as it is used for buying this com¬ 
modity, has diminished. 

On the other hand, if the index number on the later date is 93 
instead of 125, it means that the price level has gone down, which 
in turn means that it takes less money to buy a given quantity 
of cotton or any other commodity — that the purchasing power 
of money has increased. 

Thus we see that the price level and purchasing power vary in 
opposite directions. In order to compare prices of the same 
textiles or other commodities at different times, index prices 
have been arranged by various trade papers or organizations. 

These indexes have been constructed on a straight arithmetic 
average. That is, the prices of a certain number of items of 
textiles and wearing apparel have been noted and the average 
price obtained for each. To illustrate : In selecting the index for 
raw silk, five Japanese and one Canton number have been selected 
and the daily prices noted each day for a week. Then the weekly 
average is obtained by adding the prices and dividing by six. 
In the case of fabrics such as cotton goods the prices of eighteen 
gray goods are noted for a week and the average obtained by adding 
all the prices of each and then dividing by six. Similar results are 
obtained in finished cotton goods by taking a finished item. 

The raw wool index has been constructed on a somewhat similar 
basis, that is, on an arithmetic average. However, in view of the 
fact that raw wool is quoted in both grease and scoured state it 
was necessary to convert them into one classification. Therefore 
each item quoted in grease is converted into scoured, and then an 


CONSUMPTION OF CLOTHING AND TEXTILES 115 


arithmetic average of the scoured items is taken. In the case of 
foreign wool the same practice has been applied as in the case of 
domestic wool; that is, of first converting the wool quoted in the 
grease into scoured levels. This relates particularly to South 
American wools. After converting each item to a scoured basis 
we then added 34 cents, the duty chargeable for an import of 
each pound of wool used for apparel purposes. 

The Fairchild Composite Fibre Index, which is also published 
weekly, is a weighted aggregate of cotton, wool, silk, and rayon 
indexes. This index is a composite of the four fiber indexes. 
These various indexes, which are in reality average prices, have 
been converted to their pre-war base, 1911-13. For example, 
if the average cotton price for last week was 6 cents per pound, 
this would be 50 per cent of the pre-war level, which was 12 cents. 
The same procedure is applied to wool, silk, and rayon. After 
arriving at the relative indexes as compared with the pre-war, these 
relatives are multiplied by certain “ weights ” assigned. These 
weights are determined on the basis of the importance of each 
fiber to the total. For example, cotton has been assigned a weight 
of 33 per cent for 1931, wool 26, and silk and rayon the rest. 
These weights change from year to year. These various relatives 
are multiplied by these various weights, and then the total is added 
to give the composite index. 

To illustrate: The Fairchild Retail Price Index is an index of 
retail prices of wearing apparel. 

The index number on January 1, 1931 = 100. 

1932 1933 1934 



Feb. 1 

July 1 

Feb.l 

May 1 

Jan. 2 

Feb.l 

Composite Index . 

. . 81.3 

75.1 

71.1 

69.4 

88.0 

88.5 

Piece Goods. 

.. 77.8 

71.5 

67.7 

65.1 

82.8 

84.2 

Men’s Apparel. 

. . 83.3 

77.2 

72.4 

70.7 

86.2 

86.5 

Women’s Apparel. 

. . 82.9 

76.2 

72.7 

71.8 

90.3 

89.5 

Infants’ Wear. 

. . 86.6 

79.5 

77.2 

76.4 

90.4 

91.0 

Home Furnishings. 

Piece Goods 

. . 80.8 

76.2 

71.1 

70.2 

85.8 

86.5 

Silks. 

.. 77.5 

68.4 

62.8 

57.4 

69.8 

70.0 

Woolens. 

.. 78.9 

74.0 

70.4 

69.2 

81.7 

81.9 

Cotton wash goods. 

Domestics 

.. 77.1 

72.1 

70.1 

68.6 

96.9 

100.6 

Sheets. 

.. 78.0 

71.8 

67.5 

65.0 

92.6 

93.9 

Blankets and comfortables. . . 

.. 81.2 

77.2 

74.0 

72.9 

91.8 

93.1 













116 ECONOMICS OF CLOTHING AND TEXTILES 



Feb. 1 

July 1 

Feb. 1 

May 1 

Jan. 2 

Feb. 1 

Women’s Apparel 

Hosiery. 

.... 80.3 

68.2 

61.1 

59.2 

79.6 

79.5 

Aprons and house dresses. . 

.... 87.8 

80.6 

78.2 

75.5 

101.9 

101.7 

Corsets and brassieres. 

, . . . 91.0 

87.4 

84.1 

83.6 

96.1 

96.2 

Furs . . .,. 

... . 74.5 

66.5 

66.5 

66.8 

92.0 

88.2 

Underwear. 

... . 79.2 

73.8 

70.7 

69.2 

89.2 

87.8 

Shoes. 

.... 84.5 

81.0 

77.4 

76.5 

83.1 

83.3 

Men’s Apparel 

Hosiery. 

.... 80.7 

71.0 

67.0 

64.9 

86.1 

85.8 

Underwear. 

.... 80.0 

73.7 

70.7 

69.6 

92.9 

93.2 

Shirts and neckwear. 

.... 85.2 

79.5 

77.1 

74.3 

90.0 

90.3 

Hats and caps. 

. .. . 81.4 

74.6 

69.2 

69.7 

78.6 

79.1 

Clothing, including overalls 

. . .. 84.9 

80.6 

71.4 

70.1 

81.9 

83.1 

Shoes. 

.... 87.7 

83.6 

79.3 

76.3 

88.1 

87.9 

Infants’ Wear 

Socks . 

.... 86.8 

72.8 

74.0 

74.0 

88.3 

90.2 

Underwear. 

.... 87.1 

80.0 

74.6 

74.3 

92.2 

91.9 

Shoes. 

.... 90.5 

85.8 

83.0 

80.9 

90.7 

90.9 

Demand for Clothing. 

Many persons 

may 

think that there 


an overproduction of wearing apparel, and that the supply exceeds 
any reasonable demand that exists. Generally speaking, however, 
the world is still far below the saturation point in the supply of 


clothing. Many people have only a small fraction of the clothing 
goods and services that they could use to advantage. There may 
be an excess of certain kinds of clothing in certain sections, but 
there is not an excess of the various types. Even in Western 
civilization only a small fraction of the population can be said to 
be living on a luxury basis so far as clothing is concerned, and the 
vast majority are confined to the necessities. The clothing stand¬ 
ards of millions of persons in the Orient are far below the reasonable 
standards that human beings have a right to expect. 

Within the United States itself, where clothing is most abundant, 
the fulfillment of legitimate needs and desires for clothing of the 
average citizen would represent an expenditure of from three to 
five times the present budget. If American industry were called 
upon to supply even the minimum needs of the entire population, 
the present so-called overcapacity would be found inadequate. 

The demand for clothing varies with the income, as well as with 
the desires or tastes of the individual. With a definite income 
to spend on wearing apparel, one consciously or unconsciously 
















CONSUMPTION OP CLOTHING AND TEXTILES 11? 


weighs and balances one desire against another to determine which 
one to satisfy if there is not sufficient money to purchase both 
articles. Some persons will purchase any wearing apparel they 
desire, regardless of the price. Others will purchase only if they 
feel that the price is satisfactory. Thus we find that the price is 
frequently a governing factor in the selection of clothing. 

Since the consumer buys a commodity to satisfy a need or desire, 
the price he is willing to pay for it is purely subjective in character. 
That is, the value to him is directly related to the amount of satis¬ 
faction he expects to get from it. For example, if he buys a 
pair of silk stockings, they have a value for him because they 
happen to meet his taste and needs. The value of the silk stockings 
to the producer is closely related to the cost of production, but 
this is not necessarily true of their value to the consumer. In the 
same way, the value of the stockings to the middleman or trader 
depends upon the demand and supply for silk hosiery and not upon 
any personal evaluation of their utility. 

In apportioning income to be spent for clothing, an individual 
must attempt to secure wearing apparel to satisfy many different 
needs and desires. Clothes have five different purposes to serve, 
as follows : (1) the body must be protected from heat, cold, wind, 
rain, extremes, and changes; (2) warmth of the body must be 
maintained; (3) the body must be protected from injury; (4) the 
wearing apparel must be suited to the occasion; and (5) it must 
meet certain standards of adornment and self-respect. 

The variety of clothing has increased greatly during recent 
years because of the lengthening of the leisure time that came with 
the decrease in the hours of labor. The greater number of activi¬ 
ties, such as parties, clubs, automobile excursions, athletic games 
and sports, swimming, steamship excursions, etc., have attracted 
great numbers of persons and have brought with them a desire 
for specialized types of wearing apparel that are distinctive, ap¬ 
propriate to the occasion, and cause the wearer to appear to 
advantage. 

Human nature has practically unlimited wants, hence to meet 
these wants most people spend all they earn. An unlimited 
variety of clothing, jewelry, and other commodities appears on 
the market, and most people find it difficult to refrain from buying. 


118 ECONOMICS OF CLOTHING AND TEXTILES 


We soon tire of the same style of clothing, jewelry, and commodi¬ 
ties, and we get less and less satisfaction out of them; it follows 
that the intense desire for any piece of wearing apparel or any other 
commodity tends to become less and less as we use each successive 
unit of it. The demand then shifts to a new type of wearing 
apparel or to a new style. 

Laws of Consumption. Human nature responds according to 
definite reactions in meeting the wants with regard to clothing or 
other commodities. These reactions are spoken of as the laws of 
consumption, as follows: 

I. As we gradually satisfy our desire with a definite kind of 
wearing apparel, — as a new collar of special pattern, — we secure 
our greatest pleasure from the first, and reduce our pleasure with 
each additional collar we buy until we finally lose interest and buy 
no more of this style. This reaction is called the law of diminishing 
utility, that is, in the consumption of a set of identical goods 
(collar of same design) the satisfaction we derive decreases with 
each unit (collar) we purchase. 

II. By changing the style of collar we have a new form of con¬ 
sumption of them. This reaction is called the law of variety , which 
arises from different designs. 

III. Our satisfaction from the collar may be increased if we 
have a proper necktie and shirt to go with it so that they all harmo¬ 
nize. The neckwear is the framework of the face, and the collar, 
tie, and shirt combined bring the greatest satisfaction. This 
reaction is called the law of harmony and may be expressed as 
follows: Greater satisfaction results from the consumption of a 
group of commodities in combination (collar, necktie, and shirt) 
than from their consumption separately. 

IV. Our instinct of imitation causes people of the same age and 
social standing to dress similarly. Hence we have the law of 
imitation, which states that men tend to imitate (in dress and 
other commodities, according to their social standing and age) in 
consumption. 

V. In spending our income for clothing we try to distribute what¬ 
ever we have in such a way as to secure a variety of wearing apparel. 
We spend some for collars, some for shirts, gloves, neckties, suits, 
overcoats, hosiery, shoes, etc. We do not buy suits exclusively. 


CONSUMPTION OF CLOTHING AND TEXTILES 119 


This tendency or reaction is called the law of economic order of 
consumption, which states that men try to distribute their expendi¬ 
tures for different kinds of clothing and other goods so as to obtain 
the greatest possible consumer’s surplus. 

VI. Each community has classes with different social standing. 
Within each class the standard of living is fairly constant, and the 
amount of the income spent for the various groups of commodities 
is fairly constant for that social group. The relation among the 
family expenditures for different groups may be expressed in terms 
of Engel’s law of family expenditures as follows: As the income of a 
family increases, the proportional expenditure for clothing, rent, 
fuel, and light remains fairly constant, while the amount for food 
decreases, and that for cultural and higher enjoyment increases. 

Law of the Consumer’s Dollar. The consumer may think that 
he works for money, but he really works for food, shelter, clothing, 
education for his children, recreation, in short for as many as possi¬ 
ble of all the good things, tangible and intangible, that a man would 
want. His wants are and always will be endless, and this fine 
desire or trait is responsible for our progress. 

The consumer with his wages goes out to see what he can buy. 
The more he can buy for a dollar the happier or better off he is, and 
society, business, industry, including his neighbor, his employer, 
are better off. This is called the law of the consumer's dollar. Since 
most of his wages goes into the purchase of necessities — 40 per cent 
for food, 25 per cent for rent — only 35 per cent is available for the 
things besides necessities. Hence in order that the great mass of 
people may enjoy more of the commodities that give us something 
in addition to a mere existence, it is necessary to have wages of 
fairly high buying power and goods easy to buy. 

Most consumers are interested in low prices, and these can only 
be secured by mass production for the great mass of people. This 
means that from the time the raw material leaves its source of 
origin to the time it is placed in the hands of the consumer every 
process that can be mechanized should be mechanized, and every 
item of waste eliminated, including unnecessary labor. One may 
think that this will produce unemployment, but lower prices 
mean that more goods will be produced and people will have a 
shorter working week. 


120 ECONOMICS OF CLOTHING AND TEXTILES 


The two great factors of prosperity are wages, which represents 
consuming power, and, moderate prices. When wages and prices 
remain on the same level there is an element of safety for prosper¬ 
ity, but the moment prices outstrip wages prosperity decreases. 
Therefore, when industry calls for increased prices due to higher 
wages, if there is not a corresponding increase in the number of 
people employed, prices will go higher and there will be less 
buying. 

Careful investigations have shown that the spending power of 
classes is not the same for people living in the cities as for those in 
smaller communities and towns. The amount spent for clothing is 
considerably more for families living in the city than for families 
in the towns and in the country districts. 

Variety in Use. Since our desires or wants in wearing apparel 
are unlimited, it follows that there are constantly new types appear¬ 
ing. These types may differ not only in composition, structure 
(weave), and finish, but also in design. The new design may be an 
elaborate motif or a display of new shades of color or simply a 
change in direction or position. Few people realize how a change 
in direction or in position of an article of wearing apparel may 
produce a decided new effect. Take the hat which rests on the 
most important part of the body. The same hat may be placed in 
a very precise position, which gives a conservative style effect, or 
tipped at different angles so as to make one appear in varying 
moods. Then again, the appearance due to the position of the hat 
may make one appear aristocratic, vulgar, serious or humorous, 
gloomy or cheerful, dignified or flippant, rakish or righteous, fresh or 
wilted, alive or dead. Even a change of position of the same hat 
gives us a new thrill of joy, and thus creates additional pleasure or 
pyschological income. 

Thrift. Saving means the production of more income than is 
used, thus resulting in the accumulation of capital. Thrift is 
economy both in the buying of clothing and other commodities and 
in the consumption of these commodities. Saving and thrift are 
both important factors in the development of a country. Working 
people should save part of their earnings in order to have something 
for old age or for a time of sickness when they are unable to work. 
They should not only save their money but should be thrifty and 


CONSUMPTION OF CLOTHING AND TEXTILES 121 


saving in the way they consume the commodities, such as clothing, 
that they purchase with their income. Thrift is a quality that 
implies common sense or good judgment in expenditures. Care 
in looking after wearing apparel will lengthen its period of useful¬ 
ness and thus give a greater return for the money spent on it. 
Careful planning of our clothing needs and careful spending will 
give the maximum return in value — 100 cents on every dollar. 

Economical consumption of clothing means the purchase and the 
use of clothing to satisfy the largest number of wants at the mini¬ 
mum cost. Only by a definite plan for distributing our income into 
proper divisions for (a) shelter, (b) maintenance, (c) food, ( d ) cloth¬ 
ing, ( e ) advancement, (/) savings, etc., as outlined in Chapters 
XI-XIII of the author’s book Clothing and Style , can we determine 
how much to spend for different commodities. 

By following such a budget plan we can spend wisely and not 
according to passing whims and fancies. A person who lives by a 
budget is usually happier, more contented, and more businesslike 
than one who spends his money as he earns it. 

We saw in the previous chapter that there are different standards 
of living for different groups. These standards are fairly constant 
within the same income groups and are the product of years of 
living in the same general manner until fairly permanent standards 
are crystallized. The lowest income group receiving the mini¬ 
mum wage must of necessity observe the following practices :* 
(a) good spending habits, ( h ) saving habits, and (c) frugal home¬ 
making. Otherwise, the family would find itself unable to subsist 
upon the available income. 

Cost of Living. The United States Bureau of Labor Statistics 
has made a number of studies of how much money wage and 
salary workers earn and how they spend their money. One study 
was made during the last year of the War and the four months 
following the armistice, when the cost of living at that time was 
about the same as in 1929 and wages were a little lower. 

Ninety-two cities and towns in forty-two States were selected to 
make the investigation representative of the country as a whole. 
Over twelve thousand families were interrogated about the source 
and amount of their income, the way they spent it, and how much, 
if any, they had left over at the end of the year. The families were 


122 ECONOMICS OF CLOTHING AND TEXTILES 


those of wage-earners or of low and medium-sized salary earners. 
Only families with at least one child were included in the survey, 
and each family was self-supporting and English-speaking. 

In these families more than half of the men made less than 
$1250 a year, and about a fourth made less than $1050. This was 
from 93 to 94 per cent of the family income for all of the families. 
The rest of the money came from wages the wife or children re¬ 
ceived, from taking in lodgers, from gifts, or raising a garden or 
keeping poultry. The families making under $900 a year also 
received an average of sixty-four cents a year from rent and 
investments. This ran up to as high as $5.51 a year with the 
families whose incomes were from $1200 to $1500. The families 
receiving these incomes had two or three children. 

The manner in which the families spent the incomes was also 
found out. In families making less than $900, the husband earned 
$765 and about $40 more was earned in other ways. Over half of 
these families were in debt at the end of the year to an average 
amount of more than $100. They spent $31 a month for food, $9 
for clothing, $10 for rent, $5 for fuel and light, and $2.50 for furni¬ 
ture and furnishings. Twelve dollars were spent for miscellaneous 
items, which included car fare, amusements and vacation, news¬ 
papers and magazines, school tuition and books, medical care, 
funeral expenses, insurance, taxes, soap, etc. Low rent may be 
due to cottages specially constructed by corporations. 

In families making from $900 to $1200, the husband earned an 
average amount of $1013, and about $60 was received from other 
sources. They spent $38 a month for food, $13 for clothing, $12 
for rent, $5 for fuel and light, $4 for furniture and furnishings, and 
$17 for miscellaneous items. On the average, they came out about 
even at the end of the year; about two-thirds were a little ahead 
and one-third were about $100 in debt. 

In the families with incomes of $1200 and $1500 a year the hus¬ 
band earned $1252, and the family received another $90 in other 
ways. They spent $43 a month for food, $17 for clothing, $15 for 
rent, $6 for fuel and light, $5 for furniture and furnishings, and 
$12 for miscellaneous items. These families, on the average, were 
able to save about $40 a year. Some of the families had incomes 
as high as $2000 or $2500. In such cases the husband made about 


CONSUMPTION OF CLOTHING AND TEXTILES 123 


$1800 a year, and most of the rest of the money came from the 
children. These families were larger, having usually four or more 
children at home. 

It must be understood that all figures for incomes and expendi¬ 
tures given above are averages obtained from the study of 12,000 
families. 

The United States government made a report of the expenditures 
of government employees between 1930-1931 and found the follow¬ 
ing results: 


Average Amount and Per Cent of Expenditure for Each 
Group of Items 

[Number of families, 100; average persons per family, 4.5; average equivalent adult males, 
3.27 ; average income per family, $1,711.87] 


Item 


Average 
yearly ex¬ 
pense 


Per 
cent of 
yearly 
expense 


Item 


Average 
yearly ex¬ 
pense 


Per 
cent of 
yearly 
expense 


Food. 

Clothing of — 

Husband. 

Wife. 

Children. 

Total, clothing 


$556.12 

32.3 

63.59 

3.7 

59.21 

3.4 

87.87 

5.1 

210.67 

12.2 


Furniture and house 

furnishings. 

Life insurance. 

Street-car and bus fares 
Expenses of sickness . .. 

School expenses.. 

Cleaning supplies. 

Barber. 

Miscellaneous expenses. 


$88.55 

59.16 

37.40 

64.73 

6.41 

16.64 

12.37 

175.77 


5.2 
3.4 

2.2 
3.8 

.4 

1.0 

.7 

10.2 


Housing. 

Fuel and light 


388.81 

103.20 


22.6 

6.0 


Total expenses.... 


1,719.83 


100.0 


The above table shows the expenditures of the families during 
the year, distributed among the principal classes of items. Food 
constitutes the principal item of expense — 32.3 per cent of the 
total expenditure. Housing was next in importance, forming 
22.6 per cent of the year’s expenditures, while 12.2 per cent went 
for clothing. No other single item required as much as 10 per 
cent. The average outlay for clothing per year per family was 
$210.67. 

The following tables enumerate all of the clothing purchased by 
the husband and by the wife, and in connection with each article 
it shows the average number of articles purchased for all families, 
the average expenditure per family, and the average expenditure 
per article. It also shows similar averages for the families which 
purchased each specified article. 































124 ECONOMICS OF CLOTHING AND TEXTILES 

Average Quantity of and Expenditure for Clothing Purchased 

Per Family in One Year 

Clothing of 100 husbands 



All families 


Families purchasing 


Article 

Aver¬ 

age 

number 

of 

articles 

per 

family 

Aver¬ 

age 

expend¬ 

iture 

per 

family 

Num¬ 
ber of 
families 

Num¬ 
ber of 
articles 
pur¬ 
chased 

Aver¬ 

age 

number 

of 

articles 

per 

family 

Aver¬ 

age 

expend¬ 

iture 

per 

family 

Aver¬ 

age 

cost per 
article 

Headgear: 






$3.82 


Hats, felt. 

0.56 

$2.06 

54 

56 

1.04 

$3.68 

Hats, straw. 

.18 

.44 

17 

18 

1.06 

2.58 

2.44 

Caps. 

Outer garments: 

.86 

1.22 

62 

86 

1.39 

1.96 

1.41 

Suits, wool. 

.41 

11.25 

40 

41 

1.03 

28.12 

27.43 

Coats (separate). 

Trousers — 

.02 

.14 

2 

2 

1.00 

6.75 

6.75 

Wool. 

.73 

2.10 

40 

73 

1.83 

5.25 

2.88 

Cotton. 

1.39 

2.82 

62 

139 

2.24 

4.55 

2.03 

Overcoats. 

.14 

3.33 

14 

14 

1.00 

23.75 

23.75 

Mackinaws. 

.03 

.37 

3 

3 

1.00 

12.17 

12.17 

Raincoats. 

.02 

.15 

2 

2 

1.00 

7.38 

7.38 

Sweaters and lumberjacks. 

.32 

.97 

30 

32 

1.07 

3.24 

3.04 

Overalls. 

.35 

.60 

18 

35 

1.94 

3.34 

1.72 

Jumpers. 

Shirts (work or dress) : 

.08 

.11 

5 

8 

1.60 

2.16 

1.35 

Cotton. 

4.50 

5.14 

98 

450 

4.59 

5.25 

1.14 

Wool. 

Underwear: 

Undershirts: 

.12 

.31 

8 

12 

1.50 

3.84 

2.56 

Cotton. 

.45 

.40 

17 

45 

2.65 

2.35 

.89 

Wool. 

Drawers — 

.02 

.03 

2 

2 

1.00 

1.50 

1.50 

Cotton. 

.45 

.37 

16 

45 

2.81 

2.34 

.83 

Wool. 

Union suits — 

.01 

.02 

1 

1 

1.00 

1.50 

1.50 

Cotton. 

2.28 

3.05 

81 

228 

2.81 

3.77 

1.34 

Wool. 

.15 

.35 

7 

15 

2.14 

5.04 

2.35 

Pajamas. 

.18 

.25 

11 

18 

1.64 

2.30 

1.41 

Nightshirts. 

Footwear : 

Socks — 

.08 

.09 

4 

8 

2.00 

2.31 

1.16 

Cotton. 

14.09 

3.41 

99 

1,409 

14.23 

3.44 

.24 

Wool. 

.57 

.36 

21 

57 

2.71 

1.69 

.62 

Silk or rayon. 

Shoes — 

.98 

.53 

30 

98 

3.27 

1.77 

.54 

High. 

.87 

3.68 

51 

87 

1.71 

7.21 

4.23 

Low. 

Shoe repairing. 

1.44 

6.57 

2.88 

84 

92 

144 

1.71 

7.82 

3.13 

4.56 

Shoe shines. 

.19 

.02 

4 

19 

4.75 

.48 

.10 

House slippers. 

.36 

.52 

36 

36 

1.00 

1.45 

1.45 

Rubbers. 

.54 

.78 

48 

54 

1.13 

1.63 

1.45 

Arctics. 

Gloves and mittens: 

.06 

.22 

6 

6 

1.00 

3.67 

3.67 

Leather, dress. 

0.12 

$0.21 

11 

12 

1.09 

$1.87 

$1.71 

Leather, work. 

2.06 

.81 

12 

206 

17.17 

6.78 

.39 

Cotton. 

9.34 

1.97 

60 

934 

15.57 

3.28 

.21 

Wool. 

.04 

.04 

4 

4 

1.00 

1.11 

1.11 

Collars. 

.39 

.10 

12 

39 

3.25 

.85 

.26 

Ties. 

1.89 

1.52 

84 

189 

2.25 

1.81 

.81 

Handkerchiefs. 

5.73 

.60 

70 

573 

8.19 

.86 

.11 

Mufflers and scarfs. 

.21 

.33 

19 

21 

1.11 

1.73 

1.57 

Garters. 

1.18 

.33 

71 

118 

1.66 

.46 

.28 

Belts. 

.48 

.37 

44 

48 

1.09 

.85 

.78 


































































CONSUMPTION OF CLOTHING AND TEXTILES 125 


Article 

All families 

Families purchasing 

Aver¬ 

age 

number 

of 

articles 

per 

family 

Aver¬ 

age 

expend¬ 

iture 

per 

family 

Num¬ 
ber of 
families 

Num¬ 
ber of 
articles 
pur¬ 
chased 

Aver¬ 

age 

number 

of 

articles 

per 

family 

Aver¬ 

age 

expend¬ 

itures 

per 

family 

Aver¬ 

age 

cost per 
article 

Suspenders. 

.19 

.02 

.09 

.11 

.05 

.06 

.88 

.23 

1.46 

15 

2 

9 

7 

12 

52 

19 

2 

9 

1.27 

1.00 

1.00 

.72 

2.25 

.66 

12.53 

1.91 

2.81 

.57 

2.25 

.66 

Umbrellas.. 

Pocketbooks. 

Watches. 

Other clothing. 





Cleaning and repairing. 





Total, husbands’ clothing. 






63.59 














Clothing of 100 wives 


Headgear: hats. 

Outer garments: 

Waists and blouses — 

Cotton. 

Silk or rayon. 

Dresses — 

Cotton. 

Wool. 

Silk or rayon. 

House dresses and aprons. 

Aprons. 

Coats — 

Cotton. 

Wool. 

Fur. 

Raincoats... 

Sweaters — 

Cotton. 

Wool. 

Furs. 

Underwear: 

Petticoats and slips — 

Cotton. 

Silk or rayon. 

Corsets. 

Brassieres. 

Chemises — 

Cotton. 

Silk or rayon. 

Union suits — 

Cotton. 

Wool. 

Shirts and vests — 

Cotton. 

Silk or rayon. 

Bloomers, step-ins and drawers — 

Cotton. 

Silk or rayon. 

Nightgowns, cotton. 

Pajamas — 

Cotton. 

Silk or rayon. 

Kimonos and bathrobes — 

Cotton. 

Wool. 

Silk or rayon. 


1.49 

$3.80 

94 

149 

1.59 

$4.04 

$2.55 

.02 

.03 

1 

2 

2.00 

3.00 

1.50 

.01 

.02 

1 

1 

1.00 

2.25 

2.25 

1.02 

1.77 

50 

102 

2.04 

3.55 

1.74 

.05 

.48 

5 

5 

1.00 

9.59 

9.59 

1.03 

7.73 

76 

103 

1.36 

10.18 

7.51 

3.20 

3.33 

94 

320 

3.40 

3.55 

1.04 

.63 

.21 

25 

63 

2.52 

.85 

.34 

.01 

.12 

1 

1 

1.00 

12.00 

12.00 

.42 

10.54 

40 

42 

1.05 

26.35 

25.09 

.01 

1.00 

1 

1 

1.00 

100.00 

100.00 

.04 

.27 

4 

4 

1.00 

6.63 

6.63 

.02 

.04 

2 

2 

1.00 

1.99 

1.99 

.09 

.30 

9 

9 

1.00 

3.32 

3.32 

.01 

.30 

1 

1 

1.00 

29.75 

29.75 

1.56 

1.19 

67 

156 

2.33 

1.77 

.76 

.42 

.55 

27 

42 

1.56 

2.04 

1.31 

.51 

1.34 

46 

51 

1.11 

2.92 

2.63 

.51 

.27 

23 

51 

2.22 

1.17 

.53 

.05 

.04 

2 

5 

2.50 

1.75 

.70 

.17 

.21 

9 

17 

1.89 

2.38 

1.26 

.70 

.68 

30 

70 

2.33 

2.25 

.96 

.02 

.06 

2 

2 

1.00 

2.79 

2.79 

1.65 

.65 

48 

165 

3.44 

1.36 

.40 

.37 

.28 

18 

37 

2.06 

1.53 

.74 

1.40 

.80 

48 

140 

2.92 

1.66 

.57 

1.28 

1.08 

49 

128 

2.61 

2.21 

.85 

1.31 

1.14 

62 

131 

2.11 

1.84 

.87 

.01 

.01 

1 

1 

1.00 

.80 

.80 

.01 

.03 

1 

1 

1.00 

2.95 

2.95 

.07 

.16 

7 

7 

1.00 

2.27 

2.27 

.02 

.10 

2 

2 

1.00 

5.00 

5.00 

.01 

.03 

1 

1 

1.00 

2.95 

2.95 





























































































126 ECONOMICS OF CLOTHING AND TEXTILES 


Clothing of 100 wives — Continued 



All families 

Families purchasing 

Article 

Aver¬ 

age 

number 

of 

articles 

per 

family 

Aver¬ 

age 

expend¬ 

iture 

per 

family 

Num¬ 
ber of 
families 

Num¬ 
ber of 
articles 
pur¬ 
chased 

Aver¬ 

age 

number 

of 

articles 

per 

family 

Aver¬ 

age 

expend¬ 

iture 

per 

family 

Aver¬ 

age 

cost per 
article 

Footwear: 

Stockings — 

dot,ton . 

3.74 

$1.30 

68 

374 

5.50 

$1.91 

$0.35 

Wool . 

.06 

.06 

4 

6 

1.50 

1.38 

.92 

Silk nr rayon. 

4.01 

4.03 

93 

401 

4.31 

4.33 

1.01 

Shoes — 

High . 

.02 

.10 

2 

2 

1.00 

5.25 

5.25 

Low . 

1.87 

7.99 

100 

187 

1.87 

7.99 

4.27 


1.15 

73 



1.58 


TTmisp; slippers. 

.82 

.80 

55 

82 

1.49 

1.46 

.98 

TUlbbers . 

.08 

.08 

8 

8 

1.00 

1.01 

1.01 

A reties. 

.34 

.76 

34 

34 

1.00 

2.23 

2.23 

Gloves and mittens: 

Kid . 

.12 

.30 

12 

12 

1.00 

2.49 

2.49 

Gnttnn . 

.52 

.46 

46 

52 

1.13 

1.00 

.89 

Wool . 

.02 

.02 

2 

2 

1.00 

.98 

.98 

Silk . 

.02 

.02 

2 

2 

1.00 

.88 

.88 

dollar and enff sets. 

.02 

.01 

2 

2 

1.00 

.60 

.60 

Handkerchiefs . 

4.49 

.50 

60 

449 

7.48 

.83 

.11 

Scarfs . 

.14 

.23 

14 

14 

1.00 

1.64 

1.64 

Garters . 

.80 

.15 

49 

80 

1.63 

.30 

.18 

"Rp.lt'S. 

.04 

.01 

2 

4 

2.00 

.28 

.14 


.20 

63 



.31 




.71 

41 



1.72 


Umbrellas. 

.08 

.18 

8 

8 

1.00 

2.22 

2.22 

Ha.nrlha.gs and purses. 

.48 

.93 

46 

48 

1.04 

2.03 

1.95 


.13 

10 



1.32 




.01 

2 



.74 




.52 

24 



2.17 









59.21 














Such items as cleaning, pressing, shoe repairing are reported; 
other services are not. 

An explanation of the first item of the table will help to make clear the 
method of presentation. Only 54 of the 100 husbands actually bought 
felt hats during the year. They bought 56 such hats, making an average 
in round figures of 1 hat per husband buying. The average expenditure 
per family was $3.82 and the average cost per hat was $3.68. However, 
the more common inquiry is, How many felt hats are consumed per man 
per year and what do felt hats cost per year? The first two columns of 
the table show that the average man buys 0.56 felt hats per year and pays 
out an average of $2.06 per year for felt hats. The other items are ana¬ 
lyzed in like manner. 

The average expenditure for clothing for the 100 husbands, $63.59 
for the year, absorbed 3.7 per cent of all the family expenditures. Of 


































































CONSUMPTION OF CLOTHING AND TEXTILES 127 


the husbands’ clothing expense, 43 per cent was for outer garments, 
25 per cent for footwear, 7 per cent for underwear, and 6 per cent for 
headgear. 

On an average the husband appears to buy a felt hat once in about 
every 2 years, a wool suit every 2\ years, an overcoat every 7 years, and 
a sweater or “lumberjack” every 3 years. Five shirts, 2 ties, 2 cotton 
union suits, 14 pairs of cotton socks and 1 pair of silk or rayon socks, 1 pair 
of garters, 2 pairs of shoes, 2 pairs of leather work gloves, and 9 pairs of 
cotton work gloves were purchased by each husband, on the average, 
during the year. The husband usually buys shirts with collars attached; 
the replacement on separate collars was only 1 every 2\ years. 

The men’s felt hats cost on an average $3.68 each, the caps $1.41, the 
wool suits $27.43, overcoats $23.75, cotton shirts $1.14, cotton union 
suits $1.34, cotton socks 24 cents, and silk or rayon socks 54 cents a pair. 
High shoes averaged $4.23 and low shoes averaged $4.56 a pair, 
leather work gloves 39 cents, and cotton gloves 21 cents. The quantity 
and cost of other accessories and the upkeep and repair of clothing are 
shown in the table. 

The value of clothing for the 100 wives, $59.21 per year, absorbed 
3.4 per cent of all expenditures. For the wives, 44 per cent of their cloth¬ 
ing expenditures was for outer garments, 26 per cent for footwear, 15 per 
cent for underwear, and 6 per cent for headgear. From the standpoint of 
replacement of the principal articles of clothing, the wife, purchased, on 
an average, a wool coat every 2\ years, 3 hats every 2 years, a pair of 
cotton gloves every 2 years, and a corset and brassiere every 2 years. 
During the year she purchased 2 dresses, 4 pairs of cotton stockings, 
4 pairs of silk or rayon stockings, 2 pairs of shoes, 3 house dresses, 2 
petticoats or slips, 2 pairs of bloomers, a nightgown, and a pair of house 
slippers. 

The wife’s wool coat averaged in cost $25.09, the hat $2.55, cotton 
gloves $0.89, corset $2.63, and brassiere $0.53. The cotton dress had 
an average cost of $1.74 and the silk or rayon dress $7.51, the cotton 
stockings $0.35, and the silk or rayon stockings $1.01 a pair. The shoes 
averaged $4.27 for the low and $5.25 for the high shoes, the house dresses 
$1.04, the cotton petticoats or slips $0.76, and the silk or rayon petti¬ 
coats or slips $1.31. The cotton bloomers averaged $0.57 and the silk 
or rayon bloomers $0.85, the cotton nightgowns $0.87, and the house 
slippers $0.98. 

Note the limited amount of clothing purchased and the prices paid. 
There is a need of more efficient production so as to give more clothing 
for the same budget allowance. 


128 ECONOMICS OF CLOTHING AND TEXTILES 


Average Quantity of and Expenditure for Clothing for 
Children, by Age Groups 

Boys 

[Age groups have been omitted in cases where no entries occurred] 


All families 
( 100 ) 


Families purchasing 


Article 

Age group 

Aver¬ 
age 
num¬ 
ber of 
arti¬ 
cles 
per 
fam¬ 
ily 

Aver¬ 

age 

ex¬ 

pend¬ 

iture 

per 

fam¬ 

ily 

Number of 

families 

Num¬ 
ber of 
chil¬ 
dren 

Articles 

purchased 

Average ex¬ 
penditure 

Num¬ 

ber 

Aver¬ 

age 

per 

child 

Per 

child 

Per 

arti¬ 

cle 

Headgear: 










Hats, straw. 

U nder 4. 

0.01 

(!) 

1 

1 

1 

1.00 

$0.25 

$0.25 


4 and under 8 . . 

.01 

0) 

1 

1 

1 

1.00 

.25 

.25 

Hats, other. 

Under 4. 

.04 

$0.03 

3 

3 

4 

1.33 

.92 

.69 


4 and under 8 . . 

.06 

.05 

5 

6 

6 

1.00 

.89 

.89 


8 and under 12. 

.02 

.02 

2 

2 

2 

1.00 

1.00 

1.00 


15 and 16. 

.02 

.07 

2 

2 

2 

1.00 

3.48 

3.48 

Caps. 

Under 4. 

.26 

.18 

18 

19 

26 

1.37 

.97 

71 


4 and under 8 . . 

.36 

.30 

27 

28 

36 

1.29 

1.09 

.85 


8 and under 12. 

.59 

.56 

32 

36 

59 

1.64 

1.55 

.95 


12 and under 15 

.17 

.19 

9 

10 

17 

1.70 

1.90 

1.12 


15 and 16. 

.01 

.02 

1 

1 

1 

1.00 

2.00 

2.00 

Outer garments: 










Suits, wool. 

Under 4. 

.07 

.14 

4 

4 

7 

1 75 

3 62 

2 07 


4 and under 8 . . 

.16 

.76 

13 

14 

16 

1.14 

5.42 

4.74 


8 and under 12. 

.21 

2.07 

18 

21 

21 

1.00 

9.87 

9.87 


12 and under 15 

.07 

.90 

6 

7 

7 

1.00 

12.79 

12.79 


15 and 16. 

.04 

.61 

3 

3 

4 

1.33 

20.50 

15.38 

Suits, cotton. 

Under 4. 

.78 

.73 

18 

19 

78 

4 11 

3 82 

93 


4 and under 8 . . 

.66 

.71 

18 

18 

66 

3.67 

3.94 

1.08 


8 and under 12. 

.12 

.32 

6 

6 

12 

2.00 

5.33 

2.67 


12 and under 15 

.02 

.11 

2 

2 

2 

1.00 

■5.48 

5.48 

Trousers, wool. ...... 

Under 4. 

.01 

.01 

1 

1 

1 

1 00 

1 00 

1 00 


4 and under 8 . . 

.08 

.09 

4 

5 

8 

1.60 

1.87 

1.17 


8 and under 12. 

.34 

.70 

14 

15 

34 

2.27 

4.64 

2.05 


12 and under 15 

.05 

.11 

3 

3 

5 

1.67 

3.62 

2.17 


15 and 16 

.04 

.16 

2 

2 

4 

2.00 

7.90 

3.95 

Trousers, cotton. 

Under 4. 

.03 

.01 

1 

1 

3 

3 00 

1 50 

50 


4 and under 8 . . 

.23 

.19 

10 

10 

23 

2.30 

1.94 

.85 


8 and under 12. 

.81 

.93 

23 

27 

81 

3.00 

3.45 

1.15 


12 and under 15 

.24 

.47 

8 

9 

24 

2.67 

5.25 

1.97 

Overcoats. 

Under 4. 

.13 

.49 

13 

13 

13 

1 00 

3 75 

3 75 


4 and under 8 . . 

.17 

1.01 

17 

18 

17 

.94 

5.60 

5.92 


8 and under 12. 

.11 

.70 

11 

12 

11 

.92 

5.83 

6.36 


12 and under 15 

.05 

.42 

5 

5 

5 

1.00 

8.38 

8.38 


15 and 16. 

.02 

.31 

2 

o 

2 

1.00 

15.50 

15.50 

Mackinaws. 

8 and under 12. 

.04 

.21 

4 

4 

4 

1.00 

5.23 

5.23 


12 and under 15 

.02 

.13 

2 

3 

2 

.67 

4.28 

6.43 

Raincoats. 

8 and under 12. 

.03 

.07 

2 

3 

3 

1.00 

2.33 

2.33 


12 and under 15 

.01 

.06 

1 

1 

1 

1.00 

6.00 

6.00 

Sweaters and lumber- 

U nder 4. 

.12 

.18 

11 

12 

12 

1.00 

1.46 

1.46 

jacks. 

4 and under 8 . . 

.25 

.39 

20 

21 

25 

1.19 

1.86 

1.56 


8 and under 12. 

.35 

.83 

22 

26 

35 

1.35 

3.20 

2.38 


12 and under 15 

.08 

.26 

8 

9 

8 

.89 

2.88 

3.24 

Overalls. 

Under 4. 

.25 

.17 

10 

10 

25 

2 50 

1 73 

69 


4 and under 8 . . 

.37 

.29 

12 

12 

37 

3.08 

2.47 

.80 


8 and under 12. 

.23 

.22 

9 

10 

23 

2.30 

2.23 

.97 


12 and under 15 

.06 

.06 

4 

5 

6 

1.20 

1.20 

1.00 


1 Less than 1 cent. 



















































CONSUMPTION OF CLOTHING AND TEXTILES 129 


All families 
( 100 ) 


Families purchasing 


Article 


Outer garments — Contd 
Shirts, cotton 


Shirts, wool 


Underwear: 

Undershirts, cotton... 


Undershirts, wool 
Drawers, cotton. 

Union suits, cotton. . . 


Union suits, wool 


Pajamas 


Nightshirts 


Footwear: 
Socks, cotton 


Socks, wool 


Socks, silk or rayon . . . 
Shoes, high. 


Shoes, low 


Shoe repairing 


Rubber boots 


Age group 

Aver 
age 
num 
ber o 
arti¬ 
cles 
per 
fam¬ 
ily 

Aver¬ 

age 

P ex¬ 
pend¬ 
iture 
per 
fam¬ 
ily 

Number of 

families 

Num 
ber o 
chil¬ 
dren 

Articles 

purchased 

Average ex¬ 
penditure 

f 

Num 

ber 

Aver- 
- age 
per 
child 

Per 

child 

Per 

arti¬ 

cle 

Under 4. 

0.23 

$0.08 

5 

6 

23 

3.83 

$1.36 

$0 35 

4 and under 8 . . 

.73 

.39 

18 

19 

73 

3.84 

2.03 

53 

8 and under 12. 

1.98 

1.30 

32 

36 

198 

5.50 

3 60 

65 

12 and under 15 

.63 

.51 

10 

11 

63 

5.73 

4.65 

81 

15 and 16. 

.11 

.13 

3 

3 

11 

3.67 

4.33 

1 18 

4 and under 8 . . 

.02 

.02 

1 

1 

2 

2.00 

1.78 

89 

8 and under 12. 

.10 

.15 

4 

5 

10 

2.00 

2.94 

1 47 

12 and under 15 

.02 

.02 

1 

1 

2 

2.00 

2.00 

1.00 

Under 4. 

.25 

.07 

7 

7 

25 

3.57 

.95 

27 

4 and under 8. . 

.08 

.03 

2 

2 

8 

4.00 

1.30 

33 

15 and 16. 

.02 

.01 

1 

1 

2 

2.00 

1.00 

50 

Under 4. 

.15 

.10 

6 

6 

15 

2.50 

1.67 

67 

4 and under 8 . . 

.06 

.02 

1 

1 

6 

6.00 

2.10 

35 

15 and 16. 

.02 

.01 

1 

1 

2 

2.00 

1.00 

.50 

Under 4. 

.54 

.32 

15 

16 

54 

3.38 

1.97 

58 

4 and under 8 . . 

1.01 

.70 

27 

28 

101 

3.61 

2.52 

70 

8 and under 12. 

1.14 

1.01 

33 

37 

114 

3.08 

2.73 

89 

12 and under 15 

.35 

.35 

10 

11 

35 

3.18 

3.21 

1 01 

15 and 16. 

.05 

.06 

2 

2 

5 

2.50 

2.77 

1 11 

4 and under 8 . . 

.02 

.04 

1 

1 

2 

2.00 

3.96 

1 98 

8 and under 12. 

.04 

.06 

2 

2 

4 

2.00 

3.10 

1 55 

12 and under 15 

.04 

.05 

2 

2 

4 

2.00 

2.62 

1.31 

Under 4. 

.15 

.10 

9 

9 

15 

1.67 

1.06 

64 

4 and under 8 . . 

.19 

.15 

9 

10 

19 

1.90 

1.52 

80 

8 and under 12. 

.19 

.14 

8 

10 

19 

1.90 

1.41 

74 

12 and under 15 

.06 

.05 

4 

4 

6 

1.50 

1.22 

81 

15 and 16. 

.01 

.01 

1 

1 

1 

1.00 

1.00 

1.00 

Under 4. 

.21 

.09 

6 

7 

21 

3.00 

1.27 

.42 

4 and under 8 . . 

.03 

.01 

2 

2 

3 

1.50 

.60 

40 

8 and under 12. 

.04 

.03 

2 

2 

4 

2.00 

1.39 

.70 

Under 4. 

2.02 

.45 

23 

24 

202 

8.42 

1.87 

.22 

4 and under 8 . . 

3.35 

.78 

28 

29 

335 

11.55 

2.69 

.23 

8 and under 12. 

4.44 

1.32 

34 

38 

444 

11.68 

3.48 

.30 

12 and under 15 

1.91 

.56 

10 

11 

191 

17.36 

5.07 

.29 

15 and 16. 

.18 

.05 

3 

3 

18 

6.00 

1.53 

.26 

Under 4. 

.12 

.05 

4 

4 

12 

3.00 

1.38 

.46 

4 and under 8 . . 

.03 

.02 

1 

1 

3 

3.00 

2.25 

.75 

8 and under 12. 

.08 

.05 

4 

4 

8 

2.00 

1.21 

.60 

12 and under 15 

.05 

.04 

2 

3 

5 

1.67 

1.17 

.70 

15 and 16. 

.09 

.03 

3 

3 

9 

3.00 

1.13 

.38 

Under 4. 

.40 

.68 

21 

22 

40 

1.82 

3.09 

1.70 

4 and under 8 . . 

.54 

1.19 

23 

24 

54 

2.25 

4.97 

2.21 

8 and under 12. 

1.05 

2.45 

32 

36 

105 

2.92 

6.80 

2.33 

12 and under 15 

.28 

.63 

10 

11 

28 

2.80 

6.29 

2.25 

Under 4. 

.26 

.43 

16 

17 

26 

1.53 

2.54 

1.66 

4 and under 8 . . 

.44 

.97 

25 

26 

44 

1.69 

3.72 

2.20 

8 and under 12. 

.59 

1.51 

31 

34 

59 

1.74 

4.45 

2.57 

12 and under 15 

.18 

.62 

8 

9 

18 

2.00 

6.93 

3.46 

15 and 16. 

.08 

.31 

3 

3 

8 

2.67 

L0.33 

3.88 

Under 4. 


.03 

4 

4 



69 


4 and under 8 . . 


.19 

14 

15 



1.27 


8 and under 12. 


.58 

25 

28 



2 09 


12 and under 15 


.28 

10 

11 



2 54 


15 and 16. 


.06 

3 

3 



2 02 


Under 4. 

.01 

.03 

1 

1 

1 

1.00 

3'00 

3.00 

8 and under 12. 

.02 

.05 

2 

2 

2 

1.00 

2.49 

2.49 













































































130 ECONOMICS OF CLOTHING AND TEXTILES 


Boys — Continued 


Article 

Age group 

All families 
(100) 

Families purchasing' 

Aver¬ 
age 
num¬ 
ber of 
arti¬ 
cles 
per 
fam¬ 
ily 

Aver¬ 

age 

ex¬ 

pend¬ 

iture 

per 

fam¬ 

ily 

Number of 

families 

Num¬ 
ber of 
chil¬ 
dren 

Articles 

purchased 

Average ex¬ 
penditure 

Num¬ 

ber 

Aver¬ 

age 

per 

child 

Per 

child 

Per 

arti¬ 

cle 

Footwear — Continued 






9 




Hmifip slirvnprs. 

Under 4. 

0.02 

$0.01 

2 

2 

2 

1.00 

$0.55 

$0.55 


4 and under 8 . . 

.07 

.06 

7 

7 

7 

1.00 

.80 

.80 


8 and under 12. 

.08 

.07 

6 

7 

8 

1.14 

.95 

.83 


12 and under 15 

.02 

.02 

2 

2 

2 

1.00 

1.18 

1.18 


15 and 16. 

.01 

.01 

1 

1 

1 

1.00 

.145 

1.45 

Rubbers. 

4 and under 8 . . 

.08 

.07 

8 

9 

8 

.89 

.76 

.85 


8 and under 12. 

.27 

.29 

22 

24 

27 

1.13 

1.19 

1.06 


12 and under 15 

.10 

.12 

8 

9 

10 

1.11 

1.39 

1.25 


15 and 16. 

.02 

.02 

2 

2 

2 

1.00 

1.13 

1.13 

Arctics. 

Under 4. 

.03 

.05 

3 

3 

3 

1.00 

1.58 

1.58 


4 and under 8. . 

.13 

.25 

13 

14 

13 

.93 

1.79 

1.93 


8 and under 12. 

.01 

.03 

1 

1 

1 

1.00 

2.95 

2.95 

Gloves and mittens, 

Under 4. 

.01 

.01 

1 

1 

1 

1.00 

.75 

.75 

leather, dress. 

4 and under 8. . 

.06 

.05 

6 

6 

6 

1.00 

.77 

.77 


8 and under 12. 

.13 

.12 

11 

13 

13 

1.00 

.91 

.91 


12 and under 15 

.05 

.05 

4 

5 

5 

1.00 

1.09 

1.09 


15 and 16. 

.01 

.02 

1 

1 

1 

1.00 

2.25 

2.25 

Gloves and mittens, cot- 

Under 4. 

.06 

.02 

5 

5 

6 

1.20 

.39 

.33 

ton. 

4 and under 8. . 

.29 

.09 

17 

18 

29 

1.61 

.49 

.30 


8 and under 12. 

.39 

.15 

22 

25 

39 

1.56 

.60 

.39 


12 and under 15 

.03 

.01 

3 

3 

3 

1.00 

.38 

.38 


15 and 16 ... . 

.01 


1 

1 

1 

1.00 

.20 

.20 

Gloves and mittens, wool 

Under 4. 

.10 

.06 

7 

8 

10 

1.25 

.73 

.58 


4 and under 8. . 

.07 

.04 

5 

5 

7 

1.40 

.75 

.54 


8 and under 12. 

.04 

.02 

2 

2 

4 

2.00 

1.23 

.61 


12 and under 15 

.04 

.03 

4 

5 

4 

.80 

.52 

.65 

Ties. 

4 and under 8 . . 

.23 

.05 

10 

10 

23 

2.30 

.50 

.22 


8 and under 12. 

.64 

.20 

27 

31 

64 

2.06 

.63 

.31 


12 and under 15 

.22 

.09 

7 

8 

22 

2.75 

1.06 

.39 


15 and 16. 

.08 

.03 

2 

2 

8 

4.00 

1.38 

.34 

Handkerchiefs. 

Under 4. 

.18 

.01 

3 

3 

18 

6.00 

.23 

.04 


4 and under 8 . . 

.91 

.05 

14 

15 

91 

6.07 

.35 

.06 


8 and under 12. 

1.79 

.12 

24 

26 

179 

6.88 

.47 

.07 


12 and under 15 

.61 

.05 

7 

8 

61 

7.63 

.61 

.08 


15 and 16. 

.14 

.01 

2 

2 

14 

7.00 

.70 

.10 

Mufflers and scarfs. 

4 and under 8 . . 

.01 

.01 

1 

1 

1 

1.00 

.50 

.50 


8 and under 12. 

.03 

.02 

3 

3 

3 

1.00 

.58 

.58 


12 and under 15 

.02 

.02 

2 

2 

2 

1.00 

1.25 

1.25 


15 and 16. 

.01 

.01 

1 

1 

1 

1.00 

1.00 

1.00 

Garters. 

Under 4. 

.32 

.05 

15 

16 

32 

2.00 

.33 

.17 


4 and under 8 . . 

.56 

.07 

24 

25 

56 

2.24 

.28 

.13 


8 and under 12. 

.61 

.07 

24 

27 

61 

2.26 

.24 

.11 


12 and under 15 

.23 

.02 

9 

10 

23 

2.30 

.21 

.09 


15 and 16. 

.03 

.01 

2 

2 

3 

1.33 

.43 

.28 

Belts. 

8 and under 12. 

.21 

.06 

15 

17 

21 

1.24 

.37 

.30 


12 and under 15 

.07 

.04 

5 

6 

7 

1.17 

.67 

.57 


15 and 16. 

.02 

.01 

2 

2 

2 

1.00 

.50 

.50 

Suspenders. 

4 and under 8. . 

.02 

.01 

2 

2 

2 

1.00 

.43 

.43 


8 and under 12. 

.06 

.03 

4 

5 

6 

1.20 

.58 

.48 

Pocketbooks. 

Under 4. 

.01 

C 1 ) 

1 

1 

1 

1.00 

.10 

.10 


8 and under 12. 

.01 

.01 

1 

1 

1 

1.00 

1.00 

1.00 


12 and under 15 

.01 

C) 

1 

1 

1 

1.00 

.10 

.10 

Watches and jewelry.. . . 

8 and under 12. 


.08 

3 

3 



2.75 


12 and under 15 


.03 

1 

1 



3.00 


Cleaning, pressing, and 

8 and under 12. 


.10 

5 

6 



1.75 


repairing. 

15 and 16 


.07 

2 

2 



3.25 












1 Less than 1 cent. 


























































CONSUMPTION OF CLOTHING AND TEXTILES 131 


Article 

Age group 

All families 
(100) 

Families purchasing 

Aver¬ 
age 
num¬ 
ber of 
arti¬ 
cles 
per 
fam¬ 
ily 

Aver¬ 

age 

ex¬ 

pend¬ 

iture 

per 

fam¬ 

ily 

° <n 

fc.g 

Is 

Num¬ 
ber of 
chil¬ 
dren 

Articles 

purchased 

Average ex¬ 
penditure 

Num¬ 

ber 

Aver¬ 

age 

per 

child 

Per 

child 

Per 

arti¬ 

cle 

Infants’ wear (not speci¬ 
fied above): 

Dresses. 

Under 4 

.19 

.26 

.07 

.02 

.16 

$0.17 

.16 

.02 

.01 

.06 

.29 

.01 

.05 

.02 

.02 

4 

6 

3 

1 

5 

6 

2 

4 

1 

1 

4 

6 

3 

1 

5 

6 

2 

5 

1 

1 

19 

26 

7 

2 

16 

4.75 

4.33 

2.33 
2.00 
3.20 

$4.31 

2.73 

.83 

.50 

1.11 

4.79 

.70 

.97 

1.50 

2.00 

$0.91 

.63 

.36 

.25 

.35 

Rompers. 

Underwaists. 

Petticoats. 

Other infants’ wear... 
Other clothing. 

Under 4. 

Under 4. 

4 and under 8. . 

Under 4. 

Under 4. 

Under 4. 




Total, boys’ clothing 

4 and under 8. . 

8 and under 12. 
15 and 16. 









Under 4. 





5.29 
9.11 

16.67 

6.30 
2.05 







4 and under 8. . 

8 and under 12. 
12 and under 15 
15 and 16. 





































Girls 


Headgear: 

Hats. 

Under 4. 

4 and under 8. . 

0.06 

.31 

$0.06 

.45 

5 

20 

7 

36 

6 

31 

0.86 

1.19 

$0.89 

1.73 

$1.04 

1.45 


8 and under 12. 

.49 

.76 

27 

32 

49 

1.53 

2.37 

1.55 


12 and under 15 

.17 

.31 

10 

12 

17 

1.42 

2.60 

1.83 

Caps. 

15 and 16. 

.15 

.30 

7 

8 

15 

1.88 

3.79 

2.02 

Under 4. 

4 and under 8. . 

.24 

.43 

.20 

.31 

19 

27 

20 

31 

24 

43 

1.20 

1.39 

.99 

1.00 

.83 

.72 


8 and under 12. 

.27 

.22 

20 

22 

27 

1.23 

.99 

.81 


12 and under 15 

.08 

.06 

6 

8 

8 

1.00 

.69 

.69 

Outer garments: 

Ensembles, cotton. . .. 

15 and 16. 

.01 

.01 

1 

1 

1 

1.00 

.75 

.75 

4 and under 8. . 

.02 

.03 

1 

2 

2 

1.00 

1.50 

1.50 


8 and under 12. 

.04 

.08 

4 

4 

4 

1.00 

1.94 

1.94 

Ensembles, silk or rayon 

12 and under 15 

.01 

.01 

1 

1 

1 

1.00 

1.49 

1.49 

12 and under 15 

.01 

.05 

1 

1 

1 

1.00 

5.00 

5.00 

Skirts, cotton. 

8 and under 12 

.02 

.03 

2 

2 

2 

1.00 

1.49 

1.49 

Skirts, wool. 

15 and 16. 

.01 

.02 

1 

1 

1 

1.00 

2.00 

2.00 

4 and under 8 . . 

.05 

.06 

5 

6 

5 

.83 

1.08 

1.29 


8 and under 12. 

.12 

.22 

11 

12 

12 

1.00 

1.82 

1.82 


12 and under 15 

.05 

.13 

4 

5 

5 

1.00 

2.65 

2.65 


15 and 16. 

.03 

.07 

3 

3 

3 

1.00 

2.47 

2.47 

Waists andblouses, cot- 

4 and under 8. . 

.01 

.01 

1 

1 

1 

1.00 

.90 

.90 

ton. 

8 and under 12. 

.01 

.01 

1 

1 

1 

1.00 

1.25 

1.25 


12 and under 15 

.01 

.01 

1 

1 

1 

1.00 

1.00 

1.00 


15 and 16. 

.02 

.02 

1 

1 

2 

2.00 

1.50 

.75 

Waists and blouses, wool 

12 and under 15 

.01 

.01 

1 

1 

1 

1.00 

1.00 

1.00 

Waists and blouses, 

8 and under 12. 

.01 

.03 

1 

1 

1 

1.00 

3.00 

3.00 

silk or rayon. 

Dresses, cotton...... 

Under 4. 

1.19 

.69 

23 

25 

119 

4.76 

2.77 

.58 

4 and under 8 . . 

2.53 

2.01 

40 

48 

253 

5.27 

4.19 

.79 


8 and under 12. 

1.72 

1.83 

34 

39 

172 

4.41 

4.71 

1.07 


12 and under 15 

.47 

.53 

11 

13 

47 

3.62 

4.07 

1.13 


15 and 16. 

.21 

.29 

7 

8 

21 

2.63 

3.58 

1.36 


































































































132 ECONOMICS OF CLOTHING AND TEXTILES 


Girls — Continued 


Article 

Age group 

All families 
(100) 

Families purchasing 

Aver¬ 
age 
num¬ 
ber of 
arti¬ 
cles 
per 
fam¬ 
ily 

Aver¬ 

age 

ex¬ 

pend¬ 

iture 

per 

fam¬ 

ily 

«4-< 

° * 

-Q-a 

a | 
£ 

Num¬ 
ber of 
chil¬ 
dren 

Articles 

purchased 

Average ex¬ 
penditure 

Num¬ 

ber 

Aver¬ 

age 

per 

child 

Per 

child 

Per 

arti¬ 

cle 

Outer garments — Contd. 

Under 4. 

.04 

$0.07 

4 

4 

4 

1.00 

$1.81 

$1.81 


4 and under 8 . . 

.17 

.34 

10 

14 

17 

1.21 

2.41 

1.99 


8 and under 12. 

.17 

.50 

11 

13 

17 

1.31 

3.85 

2.94 


12 and under 15 

.02 

.05 

2 

2 

2 

1.00 

2.49 

2.49 


15 and 16. 

.02 

.08 

2 

3 

2 

.67 

2.63 

3.95 

Dresses, silk or rayon 

Under 4. 

.04 

.06 

2 

3 

4 

1.33 

1.83 

1.38 


4 and under 8 . . 

.09 

.29 

9 

10 

9 

.90 

2.89 

3.21 


8 and under 12. 

.22 

.77 

14 

18 

22 

1.22 

4.27 

3.49 


12 and under 15 

.10 

.55 

7 

8 

10 

1.25 

6.91 

5.53 


15 and 16. 

.16 

.80 

8 

9 

16 

1.78 

8.85 

4.98 

House dresses and 

Under 4. 

.03 

.01 

1 

1 

3 

3.00 

1.20 

.40 

bungalow aprons. . . 

4 and under 8 . . 

.03 

.02 

1 

1 

3 

3.00 

1.80 

.60 


8 and under 12. 

.03 

.02 

1 

1 

3 

3.00 

2.00 

.67 


15 and 16. 

.02 

.02 

1 

1 

2 

2.00 

2.00 

1.00 

A ratios . 

Under 4. 

0.05 

.08 

5 

5 

5 

1.00 

1.62 

1.62 


4 and under 8 . . 

.32 

.58 

29 

36 

32 

.89 

1.61 

1.82 


8 and under 12. 

.28 

.53 

25 

28 

28 

1.00 

1.89 

1.89 


12 and under 15 

.06 

.11 

6 

7 

6 

.86 

1.54 

1.80 


15 and 16. 

.05 

.12 

5 

5 

5 

1.00 

2.47 

2.47 

Gloves and mittens, kid 

Under 4. 

.01 

.01 

1 

1 

1 

1.00 

1.00 

1.00 


4 and under 8 . . 

.04 

.03 

3 

4 

4 

1.00 

.75 

.75 


8 and under 12. 

.01 

.01 

1 

1 

1 

1.00 

1.00 

1.00 


12 and under 15 

.02 

.02 

1 

2 

2 

1.00 

1.00 

1.00 

Gloves and mittens, cot- 

Under 4. 

.06 

.02 

6 

6 

6 

1.00 

.36 

.36 

ton. 

4 and under 8 . . 

.13 

.05 

13 

15 

13 

.87 

.34 

.39 


8 and under 12. 

.27 

.13 

20 

23 

27 

1.17 

.55 

.47 


12 and under 15 

.09 

.05 

6 

6 

9 

1.50 

.87 

.58 


15 and 16. 

.11 

.08 

6 

7 

11 

1.57 

1.15 

.73 

Gloves and mittens, wool 

Under 4. 

.03 

.01 

3 

3 

3 

1.00 

.42 

.42 


4 and under 8 . . 

.22 

.14 

17 

21 

22 

1.05 

.66 

.63 


8 and under 12. 

.15 

.10 

11 

13 

15 

1.15 

.80 

.69 


12 and under 15 

.03 

.03 

2 

3 

3 

1.00 

.90 

.90 


15 and 16. 

.02 

.01 

1 

1 

2 

2.00 

1.00 

.50 

Gloves and mittens, silk 

8 and under 12. 

.01 

.01 

1 

1 

1 

1.00 

.75 

.75 


4- a,nH nndp.r 8 . . 


.04 

5 

5 



.82 





.03 

4 

5 



.67 





.01 

1 

1 



.50 


TrTn.ndkerehiefs. 

Under 4. 

.05 

0) 

2 

2 

5 

2.50 

.13 

.05 


4 and under 8 . . 

.99 

.05 

15 

17 

99 

5.82 

.29 

.05 


8 and under 12. 

2.20 

.16 

24 

28 

220 

7.86 

.58 

.07 


12 and under 15 

.32 

.03 

4 

4 

32 

8.00 

.63 

.08 


15 and 16. 

.47 

.04 

7 

8 

47 

5.88 

.55 

.09 

Searfa . 

Under 4. 

.01 

.01 

1 

1 

1 

1.00 

1.00 

1.00 


4 and under 8 . . 

.02 

.02 

2 

2 

2 

1.00 

1.00 

1.00 


8 and under 12. 

.05 

.05 

5 

5 

' 5 

1.00 

1.05 

1.05 


12 and under 15 

.04 

.04 

4 

4 

4 

1.00 

1.00 

1.00 


15 and 16. 

.09 

.08 

6 

7 

9 

1.29 

1.13 

.88 

Garters. 

Under 4. 

.29 

.05 

12 

13 

29 

2.23 

.41 

.18 


4 and under 8 . . 

1.01 

.15 

34 

41 

101 

2.46 

.36 

.15 


8 and under 12. 

.73 

.10 

26 

31 

73 

2.35 

.31 

.13 


12 and under 15 

.30 

.04 

11 

13 

30 

2.31 

.33 

.14 


15 and 16. 

.10 

.01 

5 

5 

10 

2.00 

.25 

.13 

Belts. 

4 and under 8. . 

.05 

.01 

3 

3 

5 

1.67 

.18 

.11 


8 and under 12. 

.05 

.01 

3 

4 

•5 

1.25 

.13 

.10 


12 and under 15 

.02 

.01 

1 

1 

2 

2.00 

.50 

.25 


15 and 16. 

.02 

.01 

1 

1 

2 

2.00 

.50 

.25 


1 Less than 1 cent. 
































































CONSUMPTION OP CLOTHING AND TEXTILES 133 


Article 

Age group 

All families 
(100) 

Families purchasing 

Aver¬ 
age 
num¬ 
ber ol 
arti¬ 
cles 
per 
fam¬ 
ily 

Aver¬ 

age 

ex¬ 

pend¬ 

iture 

per 

fam¬ 

ily 

Number of 

families 

Num¬ 
ber O! 
chil¬ 
dren 

Articles 

purchased 

Average ex¬ 
penditure 

Num¬ 

ber 

Aver¬ 

age 

per 

child 

Per 

child 

Per 

arti¬ 

cle 

Hairpins, fancy combs, 

4 and under 8 . . 


(0 

2 

2 



$0 10 


ornaments, nets, etc. 

8 and under 12. 


$0.02 

10 

11 



14 

.... 


12 and under 15 


.01 

5 

5 



25 



15 and 16. 


.02 

5 

6 



28 


Sanitary supplies. 

12 and under 15 


.03 

2 

2 






15 and 16. 


.07 

4 

5 



1 40 


Umbrellas. 

4 and under 8. . 

.01 

.01 

1 

1 

1 

1.00 

1.25 

$1 25 


12 and under 15 

.01 

.03 

1 

1 

1 

1.00 

3.00 

3.00 


15 and 16. 

.01 

.01 

1 

2 

1 

.50 

.73 

1 45 

Handbags and purses. ... 

Under 4. 

.01 

(0 

1 

1 

1 

1.00 

.15 

15 

• 

4 and under 8 . . 

.09 

.02 

7 

8 

9 

1.13 

.28 

24 


8 and under 12. 

.06 

.02 

5 

5 

6 

1.20 

.50 

.42 


12 and under 15 

.04 

.03 

4 

4 

4 

1.00 

.80 

.80 


15 and 16. 

.09 

.09 

8 

9 

9 

1.00 

1.03 

1 03 

Jewelry. 

Under 4. 


0) 

1 

1 



i n 



4 and under 8 . . 


.02 

6 

6 



. ±u 
32 

.... 


8 and under 12. 


.06 

8 

10 



56 



12 and under 15 


.04 

3 

4 



1 00 



15 and 16. 


.08 

2 

2 



3 80 

.... 

Bloomers, step-ins, and 

Under 4. 

0.75 

.15 

13 

15 

75 

5.00 

1.02 

.20 

drawers, cotton.... 

4 and under 8. . 

1.80 

.50 

34 

40 

180 

4.50 

1.26 

.28 


8 and under 12 

1.85 

.66 

35 

40 

185 

4.63 

1.65 

.36 


12 and under 15 

.36 

.17 

10 

12 

36 

3.00 

1.45 

.48 


15 and 16 . . ; . . 

.33 

.14 

8 

9 

33 

3.67 

1.55 

.42 

Bloomers, step-ins, and 

4 and under 8 . . 

.04 

.02 

1 

2 

4 

2.00 

1.00 

.50 

drawers, silk or 

8 and under 12. 

.03 

.02 

1 

1 

3 

3.00 

1.77 

.59 

rayon. 

12 and under 15 

.13 

.09 

3 

4 

13 

3.25 

2.13 

.65 


15 and 16. 

.06 

.05 

2 

2 

6 

3.00 

2.58 

.86 

Nightgowns, cotton.... 

Under 4. 

.32 

.15 

15 

17 

32 

1.88 

.86 

.46 


4 and under 8 . . 

.33 

.18 

18 

19 

33 

1.74 

.96 

.55 


8 and under 12. 

.45 

.24 

18 

21 

45 

2.14 

1.13 

.53 


12 and under 15 

.05 

.03 

2 

2 

5 

2.50 

1.40 

.56 


15 and 16. 

.12 

.08 

5 

5 

12 

2.40 

1.69 

.70 

Pajamas, cotton. 

Under 4. 

.03 

.01 

2 

2 

3 

1 50 


41 


4 and under 8 . . 

.34 

.22 

12 

16 

34 

2.13 

1.40 

.66 


8 and under 12. 

.15 

.12 

9 

9 

15 

1.67 

1.36 

.81 


12 and under 15 

.13 

.13 

6 

8 

13 

1.63 

1.58 

.97 


15 and 16. 

.01 

.02 

1 

1 

1 

1.00 

1.69 

1.69 

Pajamas, silk or rayon. . 

8 and under 12. 

.01 

.02 

1 

1 

1 

1.00 

2.00 

2.00 


15 and 16. 

.02 

.02 

1 

1 

2 

2.00 

2.40 

1.20 

Kimonos and bathrobes, 

Under 4. 

.02 

.02 

2 

2 

2 

1.00 

1.00 

1.00 

cotton. 

4 and under 8. . 

.01 

.01 

1 

1 

1 

1.00 

1.00 

1.00 


8 and under 12. 

.03 

.05 

3 

3 

3 

1.00 

1.62 

1.62 


12 and under 15 

.01 

.01 

1 

1 

1 

1.00 

1.45 

1.45 

Footwear: 










Stockings, cotton. 

Under 4. 

1.53 

.40 

23 

25 

153 

6.12 

1.58 

.26 


4 and under 8 . . 

4.37 

1.19 

40 

48 

437 

9.10 

2.47 

.27 


8 and under 12. 

3.60 

1.13 

34 

39 

360 

9.23 

2.90 

.31 


12 and under 15 

.58 

.18 

7 

9 

58 

6.44 

2.01 

.31 


15 and 16. 

.39 

.11 

5 

5 

39 

7.80 

2.12 

.27 

Stockings, wool. 

Under 4. 

.04 

.02 

2 

2 

4 

2.00 

.88 

.44 


4 and under 8 . . 

.05 

.03 

3 

3 

5 

1.67 

.98 

.59 


8 and under 12. 

.16 

.08 

4 

4 

16 

4.00 

2.01 

.50 


12 and under 15 

.03 

.02 

1 

1 

3 

3.00 

1.50 

.50 

Stockings, silk or rayon 

4 and under 8 . . 

.07 

.03 

3 

4 

7 

1.75 

.75 

.43 


8 and under 12. 

.24 

.15 

8 

9 

24 

2.67 

1.67 

.63 


12 and under 15 

.69 

.54 

9 

10 

69 

6.90 

5.41 

.78 


15 and 16. 

.71 

.67 

8 

9 

71 

7.89 

7.43 

.94 


1 Less than 1 cent. 




















































































134 ECONOMICS OF CLOTHING AND TEXTILES 


Girls — Continued 


All families 
( 100 ) 


Families purchasing 


Article 


Footwear — Continued 
Shoes, high. 


Shoes, low 


Shoe repairing 


House slippers 


Rubbers. . 

Aprons. 

Coats, cotton 
Coats, wool. . 


Raincoats 


Sweaters and lumber¬ 
jacks, cotton. 


Sweaters and lumber¬ 
jacks, wool. 


Sweaters and lumber¬ 
jacks, silk or rayon 
Underwear: 

Petticoats and slips, 
cotton. 


Petticoats and slips, 
wool. 


Age group 

Aver¬ 
age 
num¬ 
ber of 
arti¬ 
cles 
per 
fam¬ 
ily 

Aver¬ 

age 

ex¬ 

pend¬ 

iture 

per 

fam¬ 

ily 

Number of 

families 

Under 4. 

.34 

$0.70 

14 

4 and under 8 . . 

.38 

1.03 

21 

8 and under 12. 

.27 

.55 

16 

12 and under 15 

.02 

.04 

1 

15 and 16. 

.02 

.02 

1 

Under 4. 

.23 

.35 

13 

4 and under 8 . . 

1.03 

2.37 

37 

8 and under 12. 

.95 

2.84 

34 

12 and under 15 

.34 

1.25 

11 

15 and 16. 

.27 

1.05 

8 

4 and under 8 . . 


.14 

13 

8 and under 12 


.42 

22 

12 and under 15 


.17 

8 

15 and 16. 


.23 

7 

Under 4. 

.01 

.01 

1 

4 and under 8. . 

.11 

.08 

10 

8 and under 12. 

,18 

.12 

16 

12 and under 15 

.05 

.04 

5 

15 and 16. 

.08 

.07 

6 

4 and under 8 . . 

.05 

.05 

4 

8 and under 12. 

.02 

.02 

2 

15 and 16. 

.03 

.04 

3 

8 and under 12. 

0.02 

.01 

2 

12 and under 15 

.01 

C) 

1 

15 and 16. 

.08 

.05 

2 

Under 4. 

.02 

.07 

2 

4 and under 8 . . 

.07 

.32 

6 

8 and under 12. 

.03 

.18 

3 

Under 4. 

.11 

.53 

11 

4 and under 8. . 

.25 

1.55 

18 

8 and under 12. 

.19 

1.58 

15 

12 and under 15 

.06 

.75 

5 

15 and 16. 

.07 

1.03 

6 

4 and under 8 . . 

.01 

.01 

1 

8 and under 12. 

.02 

.03 

2 

12 and under 15 

.01 

.01 

1 

15 and 16. 

.03 

.13 

3 

Under 4. 

.05 

.05 

5 

4 and under 8 . . 

.10 

.12 

9 

8 and under 12. 

.09 

.15 

9 

12 and under 15 

.01 

.03 

1 

15 and 16. 

.04 

.11 

3 

Under 4. 

.13 

.27 

11 

4 and under 8 . . 

.11 

.24 

10 

8 and under 12. 

.20 

.40 

16 

12 and under 15 

.08 

.18 

6 

15 and 16. 

.04 

.10 

4 

4 and under 8 . . 

.01 

.01 

1 

8 and under 12. 

.01 

.02 

1 

Under 4. 

.29 

.08 

11 

4 and under 8 . . 

.96 

.40 

29 

8 and under 12. 

.88 

.44 

28 

12 and under 15 

.34 

.23 

11 

15 and 16. 

.23 

.18 

8 

Under 4. 

.02 

.02 

1 


Num¬ 
ber of 
chil¬ 
dren 

Articles 

purchased 

Average ex¬ 
penditure 

Num¬ 

ber 

Aver¬ 

age 

per 

child 

Per 

child 

Per 

arti¬ 

cle 

16 

34 

2.13 

$4.36 

$2.05 

23 

38 

1.65 

4.48 

2.71 

18 

27 

1.50 

3.04 

2.02 

1 

2 

2.00 

3.96 

1.98 

1 

2 

2.00 

2.00 

1.00 

14 

23 

1.64 

2.52 

1.54 

45 

103 

2.29 

5.28 

2.31 

39 

95 

2.44 

7.29 

2.99 

13 

34 

2.62 

9.63 

3.68 

9 

27 

3.00 

11.62 

3.87 

14 



1.03 


26 



1.62 


9 



1.91 


8 



2.94 


1 

1 

1.00 

.85 

.85 

11 

11 

1.00 

.75 

.75 

19 

18 

.95 

.64 

.68 

6 

5 

.83 

.73 

.88 

7 

8 

1.14 

1.02 

.89 

4 

5 

1.25 

1.26 

1.01 

3 

2 

.67 

.55 

.82 

4 

3 

.75 

1.07 

1.43 

2 

2 

1.00 

.38 

.38 

1 

1 

1.00 

.39 

.39 

2 

8 

4.00 

2.25 

.56 

3 

2 

.67 

2.33 

3.50 

9 

7 

.78 

3.55 

4.56 

3 

3 

1.00 

6.00 

6.00 

13 

11 

.85 

4.07 

4.81 

22 

25 

1.14 

7.02 

6.18 

19 

19 

1.00 

8.34 

8.34 

6 

6 

1.00 

12.49 

12.49 

7 

7 

1.00 

14.71 

14.71 

1 

1 

1.00 

1.00 

1.00 

2 

2 

1.00 

1.75 

1.75 

1 

1 

1.00 

1.00 

1.00 

3 

3 

1.00 

4.31 

4.31 

6 

5 

.83 

.82 

.99 

10 

10 

1.00 

1.24 

1.24 

9 

9 

1.00 

1.65 

1.65 

1 

1 

1.00 

2.98 

2.98 

4 

4 

1.00 

2.85 

2.85 

11 

13 

1.18 

2.45 

2.08 

11 

11 

1.00 

2.13 

2.13 

19 

20 

1.05 

2.10 

2.00 

7 

8 

1.14 

2.50 

2.19 

4 

4 

1.00 

2.62 

2.62 

2 

1 

.50 

.63 

1.25 

1 

1 

1.00 

2.00 

2.00 

11 

29 

2.64 

.71 

.27 

35 

96 

2.74 

1.14 

.42 

33 

88 

2.67 

1.32 

.50 

13 

34 

2.62 

1.78 

.68 

9 

23 

2.56 

2.04 

.80 

1 

2 

2.00 

1.50 

.75 


1 Less than 1 cent. 







































































CONSUMPTION OF CLOTHING AND TEXTILES 135 


Article 

Age group 

All families 
(100) 

Families purchasing 

Aver¬ 
age 
num¬ 
ber of 
arti¬ 
cles 
per 
fam¬ 
ily 

Aver¬ 

age 

ex¬ 

pend¬ 

iture 

per 

fam¬ 

ily 

° <0 
<D 

s a 

3 c3 

Num¬ 
ber of 
chil¬ 
dren 

Articles 

purchased 

Average ex¬ 
penditure 

Num¬ 

ber 

Aver¬ 

age 

per 

child 

Per 

child 

Per 

arti¬ 

cle 

Underwear — Continued 










Petticoats and slips, 

4 and under 8. . 

0.01 

$0.01 

1 

1 

1 

1.00 

$1.00 

$1.00 

silk or rayon. 

8 and under 12. 

.07 

.08 

4 

4 

7 

1.75 

2.13 

1.21 


12 and under 15 

.04 

.05 

2 

2 

4 

2.00 

2.68 

1.34 


15 and 16. 

.04 

.04 

2 

2 

4 

2.00 

2.05 

1.03 

Corsets. 

15 and 16. 

.02 

.02 

1 

2 

2 

1.00 

.99 

.99 

Brassieres. 

12 and under 15 

.10 

.03 

3 

3 

10 

3.33 

1.00 

.30 


15 and 16. 

.19 

.06 

7 

8 

19 

2.38 

.78 

.33 

Chemises, cotton. 

4 and under 8 . . 

.09 

.03 

3 

3 

9 

3.00 

1.05 

.35 


12 and under 15 

.02 

.01 

1 

1 

2 

2.00 

.75 

.38 


15 and 16. 

.02 

.02 

1 

1 

2 

2.00 

2.00 

1.00 

Chemises, silk or rayon 

4 and under 8 . . 

.01 

.01 

1 

1 

1 

1.00 

1.00 

1.00 


8 and under 12. 

.02 

.03 

2 

2 

2 

1.00 

1.50 

1.50 


15 and 16. 

.01 

.02 

1 

1 

1 

1.00 

1.50 

1.50 

Union suits, cotton. . . 

Under 4. 

.25 

.18 

10 

12 

25 

2.08 

1.53 

.73 


4 and under 8 . . 

.99 

.92 

32 

39 

99 

2.54 

2.35 

.93 


8 and under 12. 

.66 

.66 

25 

29 

66 

2.28 

2.28 

1.00 


12 and under 15 

.06 

.06 

3 

3 

6 

2.00 

1.83 

.92 


15 and 16. 

.10 

.08 

4 

4 

10 

2.50 

2.00 

.80 

Union suits, wool.... 

U nder 4. 

.05 

.06 

2 

2 

5 

2.50 

3.00 

1.20 


4 and under 8. . 

.03 

.03 

1 

1 

3 

3.00 

3.00 

1.00 

Union suits, silk or 

8 and under 12. 

.02 

.03 

1 

1 

2 

2.00 

2.55 

1.28 

rayon 










Shirts and vests, cot- 

Under 4. 

.17 

.06 

6 

6 

17 

2.83 

1.02 

.36 

ton. 

4 and under 8. . 

.27 

.06 

10 

10 

27 

2.70 

.62 

.23 


8 and under 12. 

.76 

.20 

20 

25 

76 

3.04 

.81 

.27 


12 and under 15 

.39 

.12 

8 

10 

39 

3.90 

1.22 

.31 


15 and 16. 

.17 

.08 

5 

6 

17 

2.83 

1.25 

.44 

Shirts and vests, wool 

Under 4. 

.11 

.07 

4 

5 

11 

2.20 

1.41 

.64 

Shirts and vests, silk 

Under 4. 

.02 

.01 

1 

1 

2 

2.00 

.50 

.25 

or rayon. 

4 and under 8 . . 

.06 

.03 

2 

3 

6 

2.00 

.83 

.42 


12 and under 15 

.04 

.01 

1 

2 

4 

2.00 

.70 

.35 

Cleaning, pressing, and 

8 and under 12. 


.06 

4 

4 



1.44 


repairing. 

12 and under 15 


.02 

2 

2 



1.08 



15 and 16. 


.15 

4 

4 



3.81 


Infants’ wear (not speci- 










fied above) : 










Rompers. 

Under 4. 

.03 

.02 

1 

1 

3 

3.00 

1.60 

.53 

Under waists. 

Under 4. 

.18 

.04 

6 

6 

18 

3.00 

.70 

.23 


4 and under 8 . . 

.06 

.01 

3 

3 

6 

2.00 

.35 

.18 


8 and under 12. 

.02 

(0 

1 

2 

2 

1.00 

.20 

.20 

Other infants’ wear... 

Under 4. 


.29 

5 

6 



4.84 


Other clothing. 

Under 4. 


.10 

7 

8 



1.26 



4 and under 8 . . 


.08 

4 

4 



1.88 



8 and under 12. 


.02 

3 

4 



.57 



12 and under 15 


.01 

1 

1 



1.00 



15 and 16. 


.01 

1 

1 



1.00 


Total, girls’ clothing 

Under 4 . . 


4 93 







4 and under 8 . . 


14 32 








8 a.nd under 12 


16 01 








12 and under 1 5 


6.36 








15 and 16.. 


6 82 


















1 Less than 1 cent. 


The above tables show how little clothing is purchased by the 
majority of people — hardly enough to meet the necessities of 

















































































136 ECONOMICS OF CLOTHING AND TEXTILES 

< 

covering the body and keeping warm. There is a demand for 
more clothing at prices within the income of the average family. 

Children’s Clothing. The average expenditure for clothing for 
children amounted to $87.78 per year for the 100 families and 
constituted 5.1 per cent of all expenditures. This expenditure 
clothed an average of 2.45 children per family. 

Summary. People spend from 10 to 15 per cent of their income 
for wearing apparel. About 70 per cent of the clothing income is 
used for outer clothing, 20 per cent for underclothing, 5 per cent 
for accessories, and 5 per cent for care and repairs. 

Budgets. Since the wife usually controls most of the family 
expenditures, she must know how to distribute the income to cover 
all necessary items, such as rent, food, clothing, as well as the 
incidental expenses for sickness, pleasure, self-improvement, etc. 
In other words, she must be able to get one hundred cents out of a 
dollar. This task is very difficult in a family of limited income 
and requires the cooperation and encouragement of the husband 
and other members of the family. 

The following forms have been worked out by the John Wana- 
maker stores in the interest of personal service to consumers. They 
represent the experience of many years in encouraging people to 
live according to a budget. 

Whether the family is composed of a husband and wife and 
relatives, or the family in its full meaning of including a child or 
children, it is essential that a partnership should exist to make the 
budget successful. 


Suggested Family Budget 



Annual Income 
$2400 to $5000 

Annual Income 
$6000 to $10,000 

Shelter (rent, taxes, int. on mortgage, upkeep, 
etc.). 

24% — $576-1200 

25% — $1500-2500 

Maintenance (gas, electricity, service, tele¬ 
phone, minor replacements). 

15% — $360-750 

15% — $900-1500 

Food.. 

20% — $480-1000 

17% — $1020-1700 

Clothing. 

17% — $408-850 

15% — $900-1500 

Advancement (church, charity, education, 
health, etc.) and Recreation. 

14% — $336-700 

13% — $780-1300 

Savings (life insurance, saving accounts, in¬ 
vestment securities, permanent home equip¬ 
ment) . 

10% — $240-500 

15% — $900-1500 


100% — $2400-5000 

100% -$6000-10,000 



















CONSUMPTION OF CLOTHING AND TEXTILES 137 


Budget Sheet 


Annual Income $- Income Tax $_ Net Income $. 

Estimated Expenditures 



Annual 

Monthly 

Weekly 


Annual 

Shelter 

Rent or 

Taxes 

Water 

Insurance on house 
Interest on mortgage 
Repairs on house 
Commutation ticket 

Maintenance ( running 
expenses ) 

Coal and wood 

Oil 

Gas 

Electricity 

Telephone 

Service 

Laundry 

Fees 

Insurance on house¬ 
hold, goods; Fire, 
Burglary, etc. 
Household supplies 
Minor replacements 

Food 

Milk 

Ice 

Meat and fish 

Fruit and vegetables 
Groceries 

Meals out 

Kitchen garden 

(Credit supplies re¬ 
ceived ) 

Entertainment where not 
elsewhere provided 

Clothing 

Divide allowance 
amongst family ( use 
WanamakerClothing 
Budgets ) 

Cleaning 

Repairs 

Accessories 




Savings 

(apply as required) 
Payments on Home 
Savings bank 

Building and Loan 
Association 

Life insurance 
Securities 

New equipment 

Thrift clubs 

Other savings 

Extension 

Advancement and 
Recreation 

Church and donations 
Gifts; Christmas, 
general 

Clubs, societies, 
lodges 

Educational 

Reading matter 

Entertainment 

Diversion 

Health 

Health fund or 

Doctor 

Dentist 

Oculist 

Hospital or nurse 

Drug store 

Vacation fund ( excess 
over regular 
expenses ) 

Insurance; Health 
and Accident 

General 

Automobile; includ¬ 
ing garage, license, 
insurance, chauffeur 
Landscape gardening 
Traveling expenses 
Personal allowances— 
each member of the 
family for 

Carfare 

Postage 

Stationery 

Casual reading mat¬ 
ter 

Incidentals 

Man’s lunches 

Forward from first 
column 

Total 



Monthly 






























138 ECONOMICS OF CLOTHING AND TEXTILES 


Budgets for single persons include many types: the independent 
and self-supporting man or woman, the widow who often is reduced 
to a lower income, the widower, single young people who may or 
may not contemplate marriage. 


Suggested Budgets for a Single Person 



Incomes 

Approximating 

$1200 

Incomes Ranging 
from 

$2400 to $5000 

Board and Lodging — including lunches and car¬ 
fare . 

Clothing — including laundry, pressing, and 

repairing. 

Advancement and Recreation. 

Savings. 

55% — $660 

20% — $240 
15% — $180 
10% — $120 

45% — $1080-2250 

18% — $432-900 

17% — $408-850 

20% — $480-1000 

100% — $1200 

100% — $2400-5000 


Wanamaker Four Steps Chart for the Weekly Income 


Study $45 Example 

Alter Example to Suit Your Own Case 

Plan Your Own 

Income 

Expense 

Income 

Expenses 

$ 7. 


I. Savings Fund 




$ 2. 

Life Insurance 




$ 1. 

Health Fund 




$ 1 . 

Vacation Fund 




$ 3. 

Other Savings 



$18. 


II. Monthly Bills 




$12. 

Rent, including heat 




$ 1 . 

Gas and electricity 




$ 5. 

Clothing 



$14. 


III. Home Maker’s Allowance 




$12. 

Food 




$ 1 . 

Laundry 





Incidentals 




$ 1 . 

Advancement and recreation 



$ 6. 







IV. Home Earner’s Allowance 




$ 5. 

Luncheons 





Carfares 





Incidentals 




$ 1 . 

Advancement and recreation 



$45. 

$45. 





What per cent is spent for (a) accessories, including gloves, 
(b) underclothing, including hose, (c) protective clothing, ( d ) 
“dress” clothing in the following table? 







































CONSUMPTION OF CLOTHING AND TEXTILES 139 


Home Woman’s Clothing Budget 

On $200 per Year, Over a Period of Three Years Totaling $600 


Article 

1st Year 

2d Year 

3d Year 

Total 

Coats 





1 winter. 

$50.00 



«5n on 

1 spring. 

$25.00 


25.00 

Suits 



1 spring. 



$35.00 

35.00 

Dresses 



5 cotton morning or porch dresses, 3 at $3.75, 2 at 

3.75 

7.50 

5.00 

16.25 

$2.50. 





6 house dress aprons at $1.85. 

3.70 

3.70 

3.70 

11.10 

3 silk dresses, 1 at $35, 2 at $25. 

25.00 

35.00 

25.00 

85.00 

2 afternoon or evening gowns at $29.50. 


29.50 

29.50 

59 00 

1 summer voile at $12. 

12.00 


12.00 

Hats 




3 spring at $5.50. 

5.50 

5.50 

5.50 

16.50 

1 sport. 



4 00 

4 00 

3 winter at $7.50. 

7.50 

7.50 

7.50 

22.50 

1 dressy. 


10.00 


10.00 

Shoes 




3 pr. oxfords at $6.50. 

6.50 

6.50 

6.50 

19.50 

1 pr. slippers. 

7.50 



7 50 

3 pr. canvas at $5.00. 

5.00 

5.00 

5.00 

15.00 

1 pr. spats. 



2.50 

2 50 

1 pr. overshoes. 


4.50 


4 50 

2 pr. rubbers at $1.25. 


1.25 

1.25 

2 50 

1 pr. bedroom slippers. 



1.50 

1.50 

Gloves 




4 pr. chamoisette, $1. 

1.00 

2.00 

1.00 

4.00 

1 pr. kid. 

3.00 



3.00 

1 pr. winter. 


3.50 


3.50 

1 pr. silk. 



2.00 

2.00 

Sweaters 





3 wool, or 2 wool and 1 fiber. 

3.50 

3.50 

3.50 

10.50 

U NDERGARMENTS 





9 envelope chemises. 

4.50 

4.50 

4.50 

13.50 

9 vests at 50 cents. 

1.50 

1.50 

1.50 

4.50 

6 union suits at $1. 

2.00 

2.00 

2.00 

6.00 

6 nightgowns, winter, at $1. 

2.00 

2.00 

2.00 

6.00 

6 nightgowns, summer, at $1. 

2.00 

2.00 

2.00 

6.00 

4 sateen slips at $1. 

1.00 

1.00 

2.00 

4.00 

1 wa.shn.hle slip . 

3.95 



3.95 

2 silk slips . 


3.95 

3.95 

7.90 

6 brassieres at 50{i. 

1.00 

1.00 

1.00 

3.00 

3 corsets . 

3.00 

3.00 

3.00 

9.00 

1 lnmnnn . 


3.00 


3.00 

1 bathrobe. 



5.00 

5.00 

Hose 





3 pr. at $1.65. 

1.65 

1.65 

1.65 

4.95 

15 pr. at 75 i . 

3.75 

3.75 

3.75 

11.25 

4 pr. at $2.25. 

4.50 

2.25 

2.25 

9.00 

Accessories 






25.00 



25.00 

3 bags. 

3.00 

3.50 

3.50 

10.00 

2i doz. handkerchiefs. 

1.50 

3.00 

3.00 

7.50 


$194.30 

$188.05 

$179.55 

$561.90 


T 










































































140 ECONOMICS OF CLOTHING AND TEXTILES 

The Clothing Budget. Clothing and other wearing apparel 
should be selected very carefully by the consumer in terms of 
(a) inventory of present clothing, ( b ) earning power, (c) social 
position, ( d ) business position, ( e ) the occasion or intended use for 
the wearing apparel. There are times when it is economical to 
purchase cheap clothing; there are other times when it is economical 
to purchase medium or high-priced wearing apparel. 

System is the keynote of economical dressing. It has been dis¬ 
covered that sane thrift is especially lacking in woman’s dress. 
It is obvious to all thinking people that economy in the purchase 
and up-keep of the wardrobe is possible only when the expenditure 
is controlled by a clothing budget. If the planning of clothing ex¬ 
penditures were more uniformly adopted, men and women would 
not only know how to spend well, but also how to dress well. 

The advantages of a budget are : 

1. It promotes saving. The passing desire for a certain article 
may have gone by the time the budget is adjusted to permit the 
purchase. 

2. If one needs to count the cost of each garment, more thought 
is apt to be put upon the selection of clothing. 

3. One shops with a definite aim, knowing exactly what one 
needs and how much one can spend. 

4. It permits one to take advantage of true bargains by antici¬ 
pating one’s needs. 

5. It prevents waste of money at so-called “bargain counters,” 
and the buying of goods marked “at reduced price.” 

6. It will aid one to distinguish between “first class quality” 
and high price, so that one will have a knowledge of the correct 
value of materials. 

7. It will teach that economy does not mean getting the most for 
as little money as possible regardless of the suitability or character 
of the goods. 

8. The wardrobe is assembled more carefully so that each 
costume is complete, that is, one buys things which can be worn 
together. 

9. It saves time as well as money. 

Because of the unlimited character of our wants in regard to 
clothing it is obviously impossible to purchase every piece of 


CONSUMPTION OF CLOTHING AND TEXTILES 141 


wearing apparel that we might desire. We must decide on those 
items that will give us the greatest satisfaction and happiness and 
limit our purchases to the amount a person in our income class 
can spend for clothing. Life is made up of choices and decisions, 
in matters of clothing as well as other matters. 

These decisions should be the result of a careful analysis of what 
one already has in the way of wearing apparel, which requires an 
inventory of all clothing on hand. After weighing the advantages 
and disadvantages of various types of new clothing, the sum of 
money available can be distributed wisely to supplement the ex¬ 
isting wardrobe. 

Suggestions for Economical Selection. The girl or woman who 
spends a moderate and limited sum for her clothes can be very 
attractively clothed if her garments are well chosen. The person 
who possesses a few carefully selected, well-made garments of style 
and material that will look well as long as the garments hold 
together always appears well dressed. For planning and buying 
clothing the following suggestions may be helpful: 

1. Inventory the wardrobe, attic, and clothes closet carefully 
before planning to buy, and know what is really needed. 


Suggestive Outline for General Inventory 


On Hand 

Needed this yr. 

To be purch’d 

To be repaired 

Cost new 

Cost repair 

1 coat 

2 blouses 



1 coat 

2 blouses 


$1.00 

.50 

3 blouses 

1 suit 

1 blouse 

1 suit 

$2.25 

30.00 





2. With income and past expenditure as a basis, make a detailed 
plan or clothing budget of the anticipated articles needed and 
the amount of expenditure for the coming year, or if possible for 
the next three years. Twenty per cent of the total income is a 
high allowance for clothing. 

The following lists of wearing apparel are presented to show the 
various articles that one may need to have in the wardrobe. 
Wearing apparel varies in (a) style, (6) composition, (c) use or 
occasion, and (d) price, so that one can always select the article 
that will meet his or her needs and prevalent style tendencies at 
a price within the income. 

















142 ECONOMICS OF CLOTHING AND TEXTILES 


Clothing List for Women, 
Misses, Girls 


Clothing List for Men, 
Youths, Boys 



I 

II 

III 

IV 


I 

II 

III 

IV 


Num¬ 

ber 

Pieces 

Total 

Cost 

No. 

Yrs. 

Wear 

An¬ 

nual 

Cost 


Num¬ 

ber 

Pieces 

Total 

Cost 

No. 

Yrs. 

Wear 

An¬ 

nual 

Cost 

Outer Wraps 

Winter Coat. 

Summer Coat.... 

Raincoat. 

Evening Wrap . . . 
Cape. 

Suits 

Winter. 

Summer. 





Outerwear 

Fur-Lined Coat.. . 

Winter Coat. 

Summer Coat.... 
Raincoat. 

Suits 

Business. 

Evening. 

Tuxedo. 

Separate Garments 
Extra Trousers. .. 
Smoking Jackets.. 

Sport Clothes 

Suits. 

Sweaters. 

Shirts, Wool. 

Riding. 

Bathing Suit. 

Underwear 

Dressing Gown. . . 

Bathrobe. 

Shirts, Cotton.. . . 

Shirts, Silk. 

Pajamas. 

Night Shirts. 

Vests. 

Drawers. 

Union Suits. 

B. V. D.’s. 

Boys’ Blouses.... 

Hats 

Felt. 

Silk. 

Straw. 

Caps. 

Shoes 

High. 

Oxford. 

Pumps. 

Spats. 

Slippers. 

Goloshes. 

Rubbers. 

Scout. 

Sneakers. 

Rubber Boots.... 

Socks 

Wool. 

Cotton. 

Silk. 

Gloves 

Kid. 

Wool. 





Furs 

Coat. 

Neckpiece. 

Dresses 

Evening. 

Silk. 

Cloth . 

Sport. 

Wash. 

Sport Clothes 

Suits. 

Capes. 

Sweaters. 

Skirts. 

Blouses . 

Middy. 

Scarfs. 

Bathing Suits.... 
Riding Habit.... 

Underwear 

Vests. 

Knickers. 

Step-Ins. 

Combinations.... 

Chemises. 

Brassieres. 

Corsets. 

Nightgowns. 

Pajamas. 

Petticoats. 

Costume Slips.... 

Negligees. 

Bathrobes. 

Hats 

Winter. 

Summer. 

Sport. 

Shoes 

High. 

Oxford. 

Pumps and 

Strapped. 

Evening. 

Corrective. 

Goloshes. 

Rubbers. 

Spats. 

Bedroom Slippers. 









































































































CONSUMPTION OF CLOTHING AND TEXTILES 143 



I 

II 

III 

IV 


I 

II 

III 

IV 


Num¬ 

ber 

Pieces 

Total 

Cost 

No. 

Yrs. 

Wear 

An¬ 

nual 

Cost 


Num¬ 

ber 

Pieces 

Total 

Cost 

No. 

Yrs. 

Wear 

An¬ 

nual 

Cost 

Stockings 

Silk. 

Wool. 

Cotton. 

Gloves 

Kid. 

Fabric. 

Silk. 

Accessories 

Umbrella. 

Handkerchiefs.... 

Scarves. 

Handbag. 

Aprons. 

Hairnets. 

General. 

Miscellaneous 

Cleaning. 

Repairs. 

Materials. 

Seamstress. 

Milliner. 

Jewelry. 

Toilet Articles 





Accessories 

Umbrella. 

Walking Sticks. .. 

Mufflers. 

Handkerchiefs.... 

Collars. 

Ties. 

Belts. 

Garters. 

Suspenders. 

Miscellaneous 

Cleaning. 

Pressing and Re¬ 
pairs . 

Jewelry. 

Toilet Articles 






Every person has individual requirements as to clothing. No 
arbitrary price list will exactly serve any two people. Figures are 
therefore omitted and a plan presented whereby the annual clothing 
allowance of each person in a family may be computed with accu¬ 
racy by the individual. To use this list: 

1. Check in Column II all articles of every sort necessary to 
complete your clothing equipment for a full year and also for 
three years. Many articles may last three years — coats, etc. 

2 Note in Column I the required number of each article. 

3. Enter in the space checked the total sum which you consider 
reasonable to pay for these particular garments. 

4. In Column III fill in the number of years you expect the 
garments to serve. 

5. In Column IV compute from preceding entries the annual 
cost of each item. 

6. The total of the entries in Column IV will be the proper 
amount to allot for clothing in making out your annual income 
apportionment. 

















































144 ECONOMICS OF CLOTHING AND TEXTILES 


To show the uses of clothing that may be developed, let us con¬ 
sider the clothing for a young lady at college during the fall. We 
may enumerate: (a) formal afternoon costume — frock, etc., 

( b ) schoolroom costume, (c) dinner costume, ( d ) campus-wearing 
costume — blouse, etc., ( e ) swagger suit, (/) less formal evening 
gown, ( g ) all-around utility coat with fur trimmings, ( h ) football 
costume, (i) formal suit; with shoes appropriate for costumes: 
(1) sport, (2) town, (3) theater or opera, (4) evening sandals. 

The same process of selection can be used in selecting a wardrobe 
for a particular purpose, such as for an extended trip, when the 
simpler the costume and the fewer the pieces of luggage, the better. 

Intelligent Purchasing of Clothes. The following hints will be 
found useful in purchasing clothing : 

1. Plan to purchase only the essentials, carefully omitting all 
the non-essentials. 

2. In replacing articles choose materials and garments which 
will harmonize with the rest of the wardrobe. It is best to limit 
the number of colors. 

3. Choose good materials for garments that are to receive hard 
wear, such as suits, everyday coats and dresses, shoes, stockings, 
etc. Know the correct cost of materials. Some materials have 
been fairly well standardized, are reliable, attractive, in good taste, 
and never go out of style. Examples: Wool serge, broadcloth, 
twilled flannel, crepe de chine, pongee, china silk, gingham, percale, 
flaxon, and dimity. 

4. One good garment outwears two cheap ones and will be 
presentable throughout that period of service. 

5. Avoid novelties and fads. Buy standard materials. 

6. Estimate amounts before buying. 

7. Buy clothes after the rush season, as advance styles are 
always expensive. 

8. See that clothes satisfy your needs rather than your wants. 

9. Buy clothing that is conservative in style, good in color and 
line, appropriate to the use to which it is put, and suited to the 
individual. Such garments can be worn as long as the materials 
last without making over. 

10. Plan to save on summer clothes so as to have plenty for more 
expensive winter garments. 


CONSUMPTION OF CLOTHING AND TEXTILES 145 


11. Select simple underwear, saving both the initial cost and cost 
of laundering. 

12. Select garments that will serve two purposes, if possible, and 
do not buy two hats, coats, or dresses, that serve the same purpose. 

13. Every woman who demands good material, conservative 
styles, and good workmanship helps to develop industries that 
turn out high-grade products in every line. 

The cost of any material or garment depends on the quality of 
the fibers that make up the fabric, on the weave and finish, on 
the color and design, and last but not least on fashion. Good 
colors that are fast and good designs add to the cost of materials. 
But fashion often plays the leading role among the factors that 
enter into the price of cloth. At the end of the season, all the 
fashionable fabrics are often greatly reduced in price. The retailer 
must make what he can out of them before they are passe. Good 
quality in a color that has been popular in the past season may 
be obtained at a low cost. The price is not necessarily an indica¬ 
tion of the quality. At the beginning of a season, the price is due 
to the prevailing fashion, and women too frequently sacrifice 
quality for a transient style, and the cost of clothing takes a large 
per cent of the family income. 

At the same time one should avoid selecting a garment or a 
material which will not be in fashion the next year. Seasonal 
garments, fabrics, and accessories that have been so popular as 
to become a fad, or those which have been worn so long that the 
demand for them is gradually decreasing will probably not be worn 
the corresponding season next year. One may, however, safely 
buy clothing and accessories at reduced prices at the end of a 
season when their economic life of utility is over because of chang¬ 
ing seasons in case it will be renewed when the corresponding season 
returns. 

Consumers in times of depression are inclined to accept poor 
construction of fabrics in order to secure a lower price. In other 
words, quality-desire changes to price-desire on the part of the 
consumer. Thus a nationally advertised line of shirting with a 
construction of 128 X 68’s (that is, 128 warp and 68 filling threads 
to the inch) competes with other shirts containing 152 X 80, all 
retailing at $1.95. Of course, it is assumed that the make, cut, 


146 ECONOMICS OF CLOTHING AND TEXTILES 


and trim are approximately the same. The advertised line is selling 
at a higher price than the shirting with a construction 152 X 80. 

There are many articles of wearing apparel and other textiles 
that are branded or named, of which the manufacturer has had 
the name copyrighted. In such a case the government has given 
him a monopoly in its manufacture and sale. Such articles are 
usually widely advertised. Of course, the manufacturer of the 
branded article can not compel the consumer to buy, hence we 
should not think of branded or named articles as having monop¬ 
olistic prices that are forced upon the consumer. 

Economical Consumption. Wearing value and the ability to 
prolong it are important factors in the discussion of economy of 
clothing. Correct care of garments lengthens the period of use¬ 
fulness and saves expenditure for new clothing. The following 
suggestions will aid in prolonging the life of clothing. 

General Care: 1. Hang where garments will not fade. 

2. Keep the closet or wardrobe clean. 

3. Keep the clothing free from spots and stains. Insect pests 
attack soiled spots first. 

4. Brush thoroughly at intervals. Brushing restores nap, 
removes dust, and reduces the amount of cleaning required. 

5. Use bags or protectors to keep dust and moths from garments 
not worn every day. 

6. Catch any broken stitches and darn or patch a hole at once. 

If the garments are to be packed away or stored, they should be 

cleaned and brushed thoroughly first and packed as nearly air 
tight as possible. The purpose of the thorough brushing is to 
remove all moths and eggs. When the garment is thoroughly 
clean, it should be wrapped up in such a way that the moths 
can not reach it. This can be done in the following ways: 

1. Sew up in strong brown wrapping paper. 

2. Use newspapers as wrappers. They can be used in the same 
way though they are more likely to tear than wrapping paper. 

3. Use pasteboard boxes, sealed with strips of gummed paper. 
They are very successful. 

4. Use paper bags, which are for sale for storage purposes. 

Brushing and careful wrapping are the most successful moth 

preventives. If the garment has not been well brushed and 


CONSUMPTION OF CLOTHING AND TEXTILES 147 


carefully wrapped, the odor of camphor, cedar, or other similar 
substances will not keep the moths out. If the clothes are clean, 
free of moth eggs, and well packed, however, the addition of some 
anti-moth substance will aid. 

Linens and cottons should be laundered with care and folded 
away without being starched or ironed. Household linen or 
cotton should have the stains removed and be put away with¬ 
out starch, for the starch causes the material to turn yellow. 

Furs should be placed out of doors and combed and brushed 
with the greatest care so that both moths and eggs may be re¬ 
moved. If furs are cared for early in the spring and placed in 
mothproof bags, there is little danger. Another precaution should 
be against heat. It is never wise to place furs in a hot attic because 
the pelt becomes so dry that it can not resist strain. If furs can 
not be placed in a commercial storage vault it is wiser to keep them 
at room temperature or in the coolest closet in the house. 

Trade-Marks. The use of trade-marks, labels, guarantees, 
and standards when buying clothing is important. The existing 
guides to the selection of fabrics which the consumer may use are 
limited and inadequate. The type of examination possible in a 
store is only for those things which can be detected by the senses, 
thus many important characteristics of cloth can not be determined, 
and price can not be used as a measure of quality. 

At the present time the consumer’s safest guide is to buy from 
a reliable merchant. Some stores and mail order houses have 
installed textile-testing laboratories where goods purchased for 
the store are scientifically tested so that the store knows exactly 
what guarantees and claims can be made for the material. In 
some cities textile-testing laboratories are supported by merchants 
who send materials to them for testing. The information thus 
procured is available to the members of the store staff and upon 
request to the consumer. 

Some manufacturers guarantee their products for certain qual¬ 
ities, such as fiber content, laundering qualities, absence of weight¬ 
ing, or other adulterants. These guarantees should be specific 
rather than general. If the garment or fabric does not bear a 
brand or label giving this information, the intelligent sales person 
should, upon request, give this information to the consumer. 


148 ECONOMICS OF CLOTHING AND TEXTILES 


Standards for raw textile fabrics have been set up by the govern¬ 
ment, and certain standards and definitions have also been set 
up by the Federal Trade Commission. Some manufacturing 
organizations, too, have developed and established standards for 
use in their own industry. 

The American Home Economics Association and the Bureau of 
Home Economics in Washington, in cooperation with some other 
organizations, have been carrying on research and investigation 
with a view to setting up standards for certain textile products. 
In only a few cases, however, do these standards actually function 
in the selection of textiles and clothing. This is partially due to 
lack of information and demand by the mass of consumers. When 
the consumers know what standards have been set up, where to 
get reliable information concerning them, how to interpret those 
standards, and by experience learn the value of using them when 
purchasing textile products, then will the manufacturers be forced 
to furnish such information on labels placed on their products. 

Consumers Protection. In order to protect the consumer, 
various attempts have been made to have laws passed compelling 
all manufacturers to label fabrics or clothing with information 
regarding the composition of the fabric, costume, etc., in a manner 
similar to the labeling of the composition of food products. Thus 
far no success has been attained in this direction, although all 
consumers should support such a measure. 

Since the manufacturer is very clever in making fabrics look 
much superior to what they really are and since it is difficult for 
women to secure much knowledge in regard to the matter, it is 
really necessary that purchasers of fabrics be protected by the law 
just as the purchasers of foods are. That such a condition is 
possible is evidenced by the fact that England has a British Mer¬ 
chandise Mark Act that has been in successful operation for thirty- 
three years. 

Consumers in some parts of the country have organized an 
association called the Consumers’ League, which publishes a list 
of firms with the names of fabrics and costumes that measure up 
to standards of durability, etc., and also either approves or dis¬ 
approves of the wages and working conditions under which the 
articles are manufactured. Well-established firms or mills that 


CONSUMPTION OF CLOTHING AND TEXTILES 149 


manufacture fabrics and wearing apparel have recognized the value 
of establishing standards for their product. 

Thus in the purchase of wearing apparel the consumer is pro¬ 
tected by the Consumers’ League, by trade names, and by the 
good name of a well-established firm. 

Need of Cooperation. We have seen that the price that the 
consumer pays for wearing apparel is based upon production and 
exchange costs. Therefore, in order that the price may be as 
economical as possible, it is necessary to have economical produc¬ 
tion and exchange. This can be done only when the consumer 
cooperates with both the producer and the exchange agencies to 
eliminate such abuses as too rapid change of styles, purchase of 
foreign-made goods, cancellation of orders, returning of goods, 
labor difficulties causing a shut-down, wasteful advertising, etc. 

The consumer should also be willing to pay a price that will per¬ 
mit a living wage to clothing workers as well as a fair profit to the 
manufacturers. He should realize, in addition, that we owe a 
debt of gratitude to clothing and textile manufacturers as well as 
to the workers for the progressive development in machinery and 
new processes that have placed artistic, well-made clothing within 
the reach of all classes. 

Cast-Off Clothing. When a working man or woman is without 
a job, the first expense to be cut from the budget is clothing. 
Savings and borrowings must be kept for food and shelter. After 
weeks or perhaps months of unemployment the wardrobe is 
reduced to things that can’t be pawned — a few shabby garments 
not presentable in looking for work. 

Hence clothing that has been discarded should be carefully dusted, 
pressed, and given to a charity organization for distribution to one 
without a job or to some other needy person. Since the original 
owner has satisfied his wants out of the clothing he naturally has 
lost interest in it and is willing for some one else to have it. The 
economic life of the garment is thus lengthened considerably. 

Money spent for purchasing and renovating clothing for the 
poor and those in distress may reduce the amount of capital to 
be used for industry, but we must consider the fact that it raises 
the standard of living in clothing among the poor and needy, gives 
them more self-respect and dignity, and betters the condition of 


150 ECONOMICS OF CLOTHING AND TEXTILES 


those unemployed so that eventually they may become better 
workers and better members of society. Therefore, all cast-off 
garments should be carefully bundled and sent to the Red Cross 
or to charity bureaus, where they may be distributed. 

During the depression of 1931, a clothing relief committee was 
organized as one of the major bodies of the Emergency Unem¬ 
ployment Relief Committee. Through this committee, hundreds 
of distressed families in New York were outfitted so that they 
could face the everyday exigencies of life with self-respect. Men 
and women, because of the aid given them, were able to go forth 
in search of employment, and children were able to go to school. 
Within a year the committee sent out some 30,000 articles for the 
use of between 5000 and 6000 families. 

Uses for Discarded Materials. All textile materials represent 
an investment of money; that is, the cost of raw material, labor 
of manufacture, and transportation. There is a definite use for all 
textiles, even in the most worn-out condition. If any of this 
material is destroyed, it must be replaced from another source. 

Woolen, cotton, and linen rags have many uses in the household 
and in commerce: 

1. Worn-out parts of knit underwear, stockings, etc., make rag 
rugs, stove cloths, dustless dust cloths and mops, and fillings for 
hot-dish pads. 

2. Worn-out sheets, pillow cases, and parts of muslin under¬ 
wear, after laundering, may be cut into strips and rolled for band¬ 
ages or rag rugs. Small and irregular-shaped pieces make dressings. 

3. Pieces of silk make the best cloths for polishing furniture. 

4. Parts of old linen table cloths may be recut for table nap¬ 
kins ; small pieces may be sterilized and used for bandages. 

5. Old blankets, if all wool, may be sent back to the factory and 
for a small sum they will be recarded, respun, and woven into new 
blankets. 

6. Pieces of woolen goods, percales, ginghams, etc., may be used 
for patchwork quilts and comforts. 

7. Scraps of woolen and cotton material should be packed sep¬ 
arately and sold, the wool for the manufacture of shoddy, the 
cotton for the manufacture of paper. 

8. Old newspapers are valuable in paper mills. 


CONSUMPTION OF CLOTHING AND TEXTILES 151 


QUESTIONS 

1. What is meant by (a) consumption; ( b) conservation? 

2. Why is consumption of clothing an important subject to all of us? 

3 . What is meant by the popular meaning and technical meaning of 
utility applied to clothing? 

4 . What is meant by the expression marginal utility as applied to 
clothing ? 

5 . Explain the meaning of the expression marginal consumer as applied 
to those purchasing wearing apparel. 

6. Explain the meaning of consumers ’ surplus applied to the purchaser 
of clothing. 

7 . What is meant by the price of wearing apparel? How are prices 
fixed? 

8. What is meant by ( a ) normal, (b ) inflated, (c) deflated prices applied 
to clothing? 

9 . Do high prices always mean the finest in quality? 

10. Do the prices of wearing apparel change ? If so, explain. 

11. What is meant by the term price index as applied to wearing 
apparel ? 

12. Explain some one system of retail price index. 

13 . What is meant by the expressions: (a) falling market, ( b ) con¬ 
sumers’ market, (c) buyers’ market, ( d ) sellers’ market? 

14 . Explain the meaning of demand for clothing. 

15 . Have all our demands for clothing ever been satisfied? 

16 . Explain briefly the laws of consumption applied to clothing. 

17 . Explain the economics of low-price wearing apparel. 

18 . Should we throw away our cast-off clothing or give it to the needy 
and poor? 

19 . Explain a method of distributing cast-off clothing in times of 
distress or need. 

20. What is meant by thrift applied to clothing? 

21. What are the steps in selecting or purchasing wearing apparel? 

22. Describe the necessity of cooperation between manufacturers and 
consumers. 

23 . How is the consumer protected in his purchases of clothing? 

24 . What determines the utility of clothing? 

25 . The marginal consumer and the marginal producer determine the 
price of clothing. Explain. 

26 . Why has the tendency been toward “cheap” wearing apparel? 

27 . In the purchase of clothing what five things should the consumer 
take into consideration? 


152 ECONOMICS OF CLOTHING AND TEXTILES 

28 . How can we curb our tendency to buy clothing to satisfy a 
whim? 

29 . If you were a tall slender person and you wished a fur that would 
serve for business and dress, what kind should you choose? Would a 
short stout person look well in the same fur ? 

30 . Explain economical consumption. 

31 . What steps have been taken to protect the purchaser of wearing 
apparel ? 

32 . Would further laws be advisable? 

33 . Is it to the individual’s advantage to “boycott” cheaply made 
clothing? 


PROBLEMS 

1. The weekly income of a family in the West was $20. The following 
budget was used per week: Food, $7.75; clothing, $3.00; shelter, $5.10; 
operating expenses, $2.10, and the rest for advancement, (a) How much 
was used for advancement? (6) What per cent of the total income was 
used for each item? (c) Can you make suggestions for improvement? 

2. A family of five — three children under 14—have an income of 

$1412. The following amounts were spent per year: Food, $581; cloth¬ 
ing, $190; shelter, $353.93; operating expenses, $148.40; advancement 
and other incidentals the remainder, (a) What amount was used for 
advancement ? (6) What per cent for each factor in the budget ? 

3 . A family of ten spends the following amounts for clothing per 
year: 

Annual Annual 

Expenditure Expenditure 


Woman at home. $28.35 Boy 10-16 years old... $30.00 

Man at work. 37.50 Girl 6-10 years old_ 18.50 

Girl at work. 54.00 Boy 6-10 years old_ 25.00 

Boy at work. 54.50 Child 1£ to 5 years old.. 14.35 

Girl 10-16 years old... 25.50 Infant to 1^ years old. . 10.40 


4 . A family of five has the following budget per year: Clothing — 
man, $61.22; wife, $64.37; boy 11, $45.13; girl 5, $29.43 ; boy 2, $25.82. 

What is the income, approximately? What per cent of the total 
income was devoted to the clothing of each person of the family? 







CONSUMPTION OF CLOTHING AND TEXTILES 153 


5. Experts have stated that the budget figures of the average family, 
particularly for clothing, may be reduced five per cent by good manage¬ 
ment. Do you believe this statement is true? If so, enumerate some 
of the devices that might be used by more efficient management. 


6. The budgets of the following families are presented : 


Number in Family 2 

Food.$462.96 

Clothing. 206.68 

Shelter and house operation 437.37 
Miscellaneous. 444.01 


3 

$538.32 

251.11 

481.50 

466.21 


4 

$613.32 

295.54 

537.49 

484.86 


5 

$677.64 

339.97 

658.69 

498.89 


What per cent is devoted to each item? Are these budgets for city 
or rural communities ? 


7 . A family of five has the following budget: Clothing — man, $95.32 ; 
wife, $111.36; boy 11, $54.21; girl 5, $43.19; boy 2, $35.89. 

What per cent of the total income is devoted to each item? 


8. Four families have the following monthly budgets : 


Number in Family 2 3 4 5 


Savings. 

.... $65.00 

$56.00 

$50.00 

$40.00 

Food. 

.... 40.00 

50.00 

55.00 

60.00 

Shelter. 


70.00 

70.00 

70.00 

Clothing. 

.... 35.00 

40.00 

45.00 

50.00 

Operating. 

.... 30.00 

30.00 

30.00 

30.00 

Advancement. . .. 

.... 60.00 

55.00 

50.00 

50.00 


What is the total income of each family? What per cent of the total 
income is devoted to each item? Is the budget for a rural or city com¬ 
munity? 


9 . Four families have the following monthly budgets: 


Number in Family 

2 

3 

4 

5 . 

Savings. 

.$55.00 

$45.00 

$40.00 

$35.00 

Food. 

. 40.00 

45.00 

50.00 

55.00 

Shelter. 

. 60.00 

60.00 

60.00 

60.00 

Clothing. 

. 30.00 

35.00 

40.00 

40.00 

Operating. 

. 25.00 

25.00 

25.00 

25.00 

Advancement. 

. 40.00 

40.00 

35.00 

35.00 


What is the total income of each family ? What per cent of the total 
income is devoted to each item? Are the budgets of a professional or 
tradesman's family? 

















154 ECONOMICS OF CLOTHING AND TEXTILES 


10. Five families have the following monthly budgets : 


Savings.$65.00 $100.00 $125.00 $175.00 $200.00 

Food. 75.00 75.00 85.00 100.00 100.00 

Shelter. 85.00 100.00 125.00 125.00 150.00 

Operating. 50.00 65.00 80.00 100.00 100.00 

Clothing. 50.00 60.00 70.00 75.00 100.00 

Advancement. 75.00 100.00 115.00 125.00 150.00 


What is the total income of each family? What per cent of the total 
income is devoted to each item? 

11 . Four families have the following monthly budgets : 

Number in Family 2 3 4 5 


Savings.$40.00 $35.00 $30.00 $25.00 

Food. 35.00 40.00 45.00 50.00 

Shelter. 50.00 50.00 50.00 50.00 

Clothing.25.00 27.00 30.00 32.00 

Operating. 18.00 18.00 18.00 18.00 

Advancement. 32.00 30.00 27.00 25.00 


What is the total income of each family? What per cent of the total 
income is devoted to each item ? Are the budgets for rural or city com¬ 
munity? What per cent is devoted to each child in the budgets with 
children ? 

12. Consider the following budgets : 


Number in Family 

2 

3 

4 

5 

Savings. 

.. .$25.00 

$20.00 

$15.00 

$11.00 

Food. 

... 30.00 

37.00 

44.00 

50.00 

Shelter. 

... 38.00 

38.00 

38.00 

38.00 

Clothing. 

... 20.00 

23.00 

25.00 

26.00 

Operating. 

... 12.00 

12.00 

13.00 

13.00 

Advancement. 

... 25.00 

20.00 

15.00 

12.00 


13 . Study the following budgets for 

individuals: 



Savings. 

... .$7.00 

$10.00 

$20.00 

$30.00 

$45.00 

$60.00 

Room and two meals 

. . . .35.00 

44.00 

50.00 

56.00 

65.00 

76.00 

Luncheons. 

.... 9.00 

9.00 

10.00 

12.00 

15.00 

18.00 

Laundry. 

.... 3.00 

4.00 

5.00 

5.00 

5.00 

7.00 

Clothing. 

.... 15.00 

18.00 

20.00 

22.00 

30.00 

40.00 

Advancement. 

.... 11.00 

15.00 

20.00 

25.00 

40.00 

50.00 

What is the total 

income of each individual? 

What is the per cent of 


the total income in each item? 

























CHAPTER V 


DEVELOPMENT OF THE PRODUCTION AND 
MANUFACTURE OF TEXTILES 

Systems. Since the day of our first parents there has been more 
or less demand for some kind of wearing apparel. The various 
ways of meeting these demands for clothing may be considered 
roughly in relation to the four stages of industrial development: 
(1) the agricultural or household stage, (2) the handicraft stage, 
(3) the domestic system, and (4) the factory system. 

Agricultural or Household Stage. Man first lived in caves or in 
the open and secured his food and clothing by hunting the wild 
beasts. Later, families began to group together and goats, sheep, 
and other animals were domesticated and raised on large areas of 
land. This first period is called the hunting and the second the 
pastoral period. During the hunting period, protection against 
wild beasts and a supply of food constituted man's chief needs. 
His clothing consisted of the skins of animals from which the hair 
had not been removed. The skin was freed of flesh and exposed 
to the sun and air for preservation. During this exposure, it was 
subjected to beating to prevent its becoming hard and stiff. The 
beating also gave smoothness to the skin. After this curing 
process the skin was thrown over the left shoulder and draped 
about the body in an oblique position, so that the right arm and 
shoulder were left free. The skin extended to cover the front and 
back of the thighs for purposes of modesty. When the early 
travelers went to the mountains, smaller pieces of skins were used 
to cover the breast and protect the lungs. In colder climates, of 
course, the entire body, with the exception of the face, was covered 
by furs. The various portions of the skins were held together by 
thorns, which took the place of pins. 

During the hunting stage of existence men moved from place to 
place in search of the necessities of life, and made no attempt to 
cultivate the soil or to produce any goods other than those that 

155 


156 ECONOMICS OF CLOTHING AND TEXTILES 


were present in a natural state. Hence during this early period 
there was no industry or exchange of goods. Each family secured 
its own food, skins for clothing, etc. During the pastoral stage, 
when domestic animals were kept, large areas of land were required, 
and there was a tendency to use captives as slaves to assist in the 
labor. There was still very little trading, and each family or group 
supplied its own needs. The agricultural period of the pastoral 
stage began when man tried to cultivate the soil, which marks the 
beginning of a social life and of a permanent civilization. Almost 
everything except luxury products was made in the household. 
At first the skins were used for mats, wall coverings, and bed 
coverings, as well as clothing, and later the fibers of plants and 
animals were spun and woven or pressed into fabrics. For this 
reason, the name of the household system has been used to 
describe the methods of manufacture and industry that prevailed 
from a period of antiquity to the early part of the Middle Ages. 
At some time during this early pastoral existence man learned 
the first use of textiles and invented the processes of spinning and 
weaving. 

Textile Processes. Since originally all textiles and clothing 
were made in the home, the processes for making cloth, thread, etc. 
were naturally invented in the home. Amid toil and romance, 
in front of the fireside, the slow devices for making thread and 
clothing were based upon home operations, such as the combing 
and braiding of the hair. In other words, the original conceptions 
of spinning, weaving, knitting, braiding, etc. were all invented by 
the women. Money was scarce, the country was impoverished, 
and the women were obliged to perform the operations of spinning, 
knitting, and weaving during practically all their leisure time, even 
when they were entertaining their neighbors. All of which must 
have stimulated every one to use his best efforts to improve the 
methods of working and the quality of the product. 

The motions through which the raw material passed were devel¬ 
oped by practice into a technique that has given us remarkable 
examples of textiles. As time went on, the men adopted mechani¬ 
cal movements in the form of hand devices for performing spinning, 
weaving, knitting, and braiding, but the original conception was 
by the women. 


DEVELOPMENT OF PRODUCTION OF TEXTILES 157 



Spinning Whorl 
One of the earliest devices 
used for spinning 


While the men spent most of their time hunting, the women 
began improving their personal appearance, which meant arrang¬ 
ing their hair in appropriate form, mak¬ 
ing their fur clothing attractive by 
fringes, etc. In arranging the hair, 
which naturally was long, came the 
idea of removing the oil and perspira¬ 
tion, and arranging the matted loose 
hair into attractive forms at the back 
of the head. This involved the use of 
the hand in twisting the hair back, 
followed by both fine and coarse teeth 
combing. The idea of braiding by means of finger manipulation 
followed. 

Spinning. The first notion of spinning came from pulling and 
twisting the hair into strands or smaller thread-like formations. 
From the habit of playing with the hair to make it more attractive 
came the desire to take the loose wool torn from the sheep’s back 

and twist it into thread to use to hold 
together the different parts of the skins 
composing the clothing. Of course, 
the first forms of threads were crude 
and did not resemble to any great 
degree the finished thread of today. 
But nevertheless the principle involved 
was the same. 

The desire for thread and yarn for 
home use became so great that the 
women spent much of their time in 
making some kind of thread. The 
slow and constant repetition of pulling 
and twisting developed in the arms, 
hands, and fingers a habit of great 
precision and technique. Generation 
after generation of practice in this task 
must have prompted many to use their 
strength and technique to best advantage by the aid of a simple 
mechanical device, called the distaff or spindle. The distaff was 



Spinster, Distaff, and 
Spindle 





158 ECONOMICS OF CLOTHING AND TEXTILES 


a cleft stick about three feet long, on which was fastened a 
quantity of wool, cotton, or flax to be spun. The lower end of the 
distaff was held between the left arm and the side, so as to leave 
the hands at liberty to draw the thread and manage the spindle, 

the fibers from the bunch of raw 
material being drawn out and 
twisted into a thread by the 
fingers of the right hand. As 
the thread was formed, it was 
wound on a suspended spindle. 
The person using the distaff 
and spindle was called a spin¬ 
ster. 

The exact date at which 
spinning was invented is un¬ 
known, but from earliest times 
man clothed himself, first in skins and later in cloth made from 
spun and woven wool. 

How many centuries elapsed before the improvement reached the 
perfection of the distaff and spindle can not be ascertained. It is 
certain that in reaching this point the inventive genius of mankind 
seemed to have exhausted itself in that direction, for thousands 
of years passed by before another forward movement was effected, 
and we find that all the nations of antiquity used the distaff and 
spindle to form their threads. 

Weaving. The invention of weaving is clouded in the mystery of 
antiquity, but no doubt it was conceived by the women at home, 
which accounts for the fact that it seemed to be known by all early 
nations. It is so old that it is closely related to the history of 
mythology. 

According to Pliny, the Assyrians believed Queen Semiramis 
to have been the inventress of weaving. Minerva, in many pieces 
of ancient statuary, is represented with a distaff, evidently for the 
purpose of conveying the impression that it was she who first 
taught men the art of spinning. This honor is given by the 
Egyptians to Isis; by the Mohammedans to a son of Japeth ; by 
the Chinese to the consort of their emperor, Yas; and by the 
Peruvians to Mamcella, wife of Manco-Capac, their first sovereign. 



From an Egyptian monument 

















DEVELOPMENT OF PRODUCTION OF TEXTILES 159 


These traditions serve to carry the invaluable art of spinning and 
weaving back to an extremely remote period — thousands of years, 
no doubt, prior to the writing of the first book. According to Melik 
Cassam Mirza, of Tabriz, Persia, the weaving of silk was first 
practiced in China, in the province of Kiang Nau, about the year 
2257 b.c. 

It is altogether likely that this art was invented, and brought to 
a high state of perfection at different periods, by nations of people 
not only widely 
separated but 
totally un¬ 
known to each 
other. Whether 
spinning or 
weaving was in¬ 
vented first is 
now hopelessly 
beyond dis¬ 
covery, though 
the conjecture 
may be hazard¬ 
ed, with a great 
probability of 
truth, that it 
was the latter. 

In primitive times the art of weaving was of the simplest char¬ 
acter. The weaver spun a single length of yarn and wound it into 
a ball; then he stuck two sticks in the ground and to these affixed 
crosspieces, from which he stretched his warp; next he interlaced 
a second thread (the weft) by a simple process of darning, pressing 
the weft as tightly together as he desired by the aid of his fingers. 
For long ages we may believe that little progress was made in the 
art. In time, however, certain ancient nations — notably the 
Peruvians of South America, and the Egyptians and the Chinese of 
the Old World — attained great skill, though the instruments they 
possessed showed little advance from that described above. India 
for many centuries enjoyed a high reputation for the variety, 
beauty, and fineness of her woven textures; all these were wrought 



Such looms are used in India today 










160 ECONOMICS OF CLOTHING AND TEXTILES 


with the simplest tools, the threads being spun by the distaff and 
spindle or the single-thread wheel, and the shuttle being passed 
through the open warp from hand to hand. 

The methods of weaving practiced today by the Navajo Indians 
is the same employed by the hand weavers of India and China, and 

is virtually identical with the 
method that has been used 
from the beginning by primi¬ 
tive weavers. The warp is 
stretched between two par¬ 
allel poles suspended be¬ 
tween upright posts, and the 
weft or filling threads are 
drawn in and out of the 
warp with a rude wooden 
needle, somewhat like a 
fisherman’s needle, and 
beaten together with a stick. 
Seated upon the ground and 
with no pattern except that 
in the mind’s eye, geometric 
designs and quaint figures 
are worked in the fabric with 
threads of beautiful colors. 
Upon such a loom are woven 
the beautiful blankets and rugs that are considered durable and 
artistic today. 

Felting. Felting was discovered when primitive man observed 
that the wool on the inside of his skin garments for warmth grad¬ 
ually became matted together. The parts of the garments which 
received the most pressure or rubbing became felted first. Thus 
men finally learned that if they placed layers of wool on a mat, wet 
it, trod on it or rolled it and beat it, the fibers became firmly and 
permanently closely felted together. This made a soft, stout, light¬ 
weight fabric which served many needs. 

Materials for Clothing. During the earliest stage of existence 
man obtained his clothing from the skins of wild animals. He 
contributed nothing to the development of the animals and lived 



















DEVELOPMENT OF PRODUCTION OF TEXTILES 161 


a hand-to-mouth existence. This method of obtaining a raw 
material for clothing — wild silk (tussah silk) — is used today. 
The wild silkworm develops among the oak trees of China and 
India and is simply collected by the natives. 

When man began to tame wild animals,— goats and sheep, — 
his supply of skins for clothing became more constant and he was 
able to live in larger groups, because he could depend upon a con¬ 
stant supply of skins from his domesticated flock. He no longer 
lived from hand to mouth but moved from place to place only for 
better pasturage, and had much leisure time. This method of 
raising raw material for clothing exists today among the nomadic 
people of the hills of India and Arabia, and some Indians of the 
United States. 

During the agricultural stage man chose a permanent abode and 
fertilized and tilled the ground so as to increase the productiveness 
of the soil. More people could live on a definite area of land during 
this period than during the previous periods. 

During the hunting and pastoral stages 
of civilization, woman became acquainted 
with many plants which she adapted to her 
need for baskets, nets, ropes, and carriers of 
various kinds. She learned how to extract the 
fibers and how to prepare them for use. Dur¬ 
ing the agricultural period the seeds of many 
of these plants were planted, and the fibers 
such as cotton (seed fibers) and linen (stem 
fibers) were used for clothing. The women 
found that these fibers were cooler than wool, 
easier to wash, and could be artistically colored. 

Later man began to improve in the use and the 
decoration of his clothing for both himself and 
his family. He learned how to improve the 
stock so that special grades of fineness, etc. of T HE Common Flax 
wool would develop. He also learned to remove Plant 

the fleece each year, and to take the fibers to the home, where the 
women washed, carded, and spun the wool. In some cases they dyed 
it with the coloring matter of plants and wove fabrics for mats, rugs, 
and clothing for the children and women, and later for the men. 





162 ECONOMICS OF CLOTHING AND TEXTILES 


Linen. The origin of the manufacture of linen is traced back to 
times lost in the twilight of fable and many centuries before the 
Christian era. There is no other textile that has such a history. 
No one knows at what point of primitive life the savage found 
the wool of his sheep preferable to its pelt, nor just when 
linen came like a new dispensation over that. The use of flax 
reached perfection at an early age in India, Egypt, and Babylon. 



Flax Gathering 

From an ancient monument at El Kab, Egypt 


It was probably from the Egyptians that the Hebrews learned 
many of their linen-weaving secrets. The splendid hangings of 
the tabernacle in the wilderness, as well as the priests’ robes, were 
of shining linen, and the high priest’s girdle was of linen so curi¬ 
ously made as to suggest a snake’s skin. These robes were after¬ 
wards unraveled to make wicks for the sacred lamps. The mufflers 
and veils and turbans that made the picturesque toilet of the 
Hebrew women were all of linen; and it was fine linen that always 
moved the imagination of their poets. Solomon, it is said, had veils 
and hangings of the softest linens wrought with exquisite devices; 
and the Egyptian princess who was his wife brought from her home 
robes of linen whose sheer gauze was wonderfully embroidered. 

The Egyptians were remarkably skillful in the manipulation of 
flax, producing linen fabrics far exceeding in fineness any cloths 
that may at present be spun and woven by the most improved 
mechanical inventions. The decorations of their temples show 
the kinds of implements used in the cultivation of flax, the treat¬ 
ment of the fiber, and the processes of spinning and weaving. 
Their mummy wrappings show that with their crude appliances and 
simple methods this ancient people could produce a linen cloth 
much finer than any that can now be made. One piece of linen 




























DEVELOPMENT OF PRODUCTION OF TEXTILES 163 


cloth wrapped about an Egyptian mummy has 540 warp threads 
to the inch; while the finest ever spun and woven in Europe has 
only 350 threads per inch. 

The Phoenicians did much to extend the culture of flax and the 
art of weaving linen. Their ships plowed the Atlantic more than 
three thousand years ago, even 
journeying to Britain, for they were 
a nation of traders. There is every 
reason to believe that the Chaldeans 
excelled in spinning and weaving flax, 
while the Babylonians, centuries be¬ 
fore Christ, were noted for their 
luxury and the high state of develop¬ 
ment of their textile art. They 
manufactured fabrics of flax, cotton, 
and wool. 

In ancient Greece there was a 
distinct linen industry with slaves as 
operatives, as well as a household 
industry; for in both the cottage 
and the palace a special room was set 
apart for the occupation of weaving. 

In Homeric times maids and matrons 
of high degree were familiar not only with weaving but also with 
spinning and embroidery. As in Greece, so in Rome also there were 
regular linen establishments, and at the same time a domestic manu¬ 
facture practiced by maids and matrons. Wool was earlier used for 
clothing by the Romans; then linen was employed, first for domes¬ 
tic uses and later as a dress material, the women adopting it long 
before the men. 

The knowledge of linen manufacture was carried from Egypt 
into Greece and Rome. In Rome the industry was fostered and en¬ 
couraged by the emperors, but the principal supply was brought 
from Egypt. The Romans considered it beneath their dignity to 
engage in any pursuit except war, and Cicero condemned all trades 
as “mean and sordid, only to be carried on successfully by means of 
lying.” Many of the old Roman families regarded linen itself as 
too luxurious and effeminate, and clung to their woolen robes long 



Greek and Roman Method 
of Weaving 




















164 ECONOMICS OF CLOTHING AND TEXTILES 



after the rest of the world wore the softer fabric. Pliny, the 
Roman historian, speaks with mild contempt of the ladies beyond 
the Rhine, whose best wear was linen; but in the proper seasons 
it has remained choice wear from then till now, the world over. 


Stacks of Flax in Belgium 

Ovid speaks of the priests of Rome as wearing linen, and probably the 
lawn of the Anglican bishop is the legitimate successor of that linen. 

Cotton. The origin of the cotton plant is shrouded in mystery, 
but it seems to have been indigenous in India, Africa, and America. 
We know that it was grown and made into cloth of unsurpassed 
fineness and beauty many hundred years before Christ, though it 
did not reach Europe until about a.d. 900. The Greek historian 
Herodotus, who was born 484 b.c., wrote of the fleeces which sur¬ 
passed those of sheep in beauty. 

Columbus found the natives of America wearing cotton garments 
and using hammocks made from cotton cord. Cortez and Pizarro 
found cotton cloth of surprising quality and beauty manufactured 
in Mexico and Peru. Some cotton cloth, beautiful in design and 
color, has been found in ancient Peruvian tombs. Early explorers 
found natives of South Africa wearing garments made of cotton. 

The Moors first introduced cotton into Spain and from there 
the use gradually spread over Europe. Cotton cloth was manu- 




DEVELOPMENT OF PRODUCTION OF TEXTILES 165 


factured in Venice, Milan, and other Italian cities during the six¬ 
teenth century. 

After the sixteenth century cotton goods and cotton were 
imported from India to all parts of Europe. European merchants 
and traders who imported cotton goods, spices, and silks amassed 
great fortunes and became very powerful. The East India Com- 



SlLKWORMS AND COCOONS 


pany, sanctioned by the King of England, practically controlled 
the English trade. 

Silk. The immediate offspring of our first parents having sub¬ 
dued the sheep and learned how to make use of its wool, and another 
branch of the family, known as the Egyptians, having discovered 
and been the first to cultivate flax, which they used as a textile 
material on account of the blossom resembling the ethereal blue 
of the heavens, it remained for descendants of Noah, the Chinese 
people, to discover and develop the cultivation of the silkworm. 
It is in keeping with the eternal fitness of things that the discovery 
of the utility and excellence of the material derived from the silk¬ 
worm should be traceable to a woman in the person of See-ling-chi, 
wife of Hoang-ti, emperor of China 2700 years before the Christian 
era. According to the written records of China, it was this empress 
who, with her own royal hands, first unraveled the cocoons and 
wove the glossy filaments into a web of glorious sheen. She is now 
worshiped throughout the Mongolian empire as the “goddess of 
silkworms/' and at her annual festival the reigning empress per¬ 
formed the ceremony of feeding the worms. 

The Chinese guarded well the secret of their valuable art, and on 
account of their vigilant jealousy many centuries elapsed before the 



166 ECONOMICS OF CLOTHING AND TEXTILES 



Weaving Pattern — China, a.d. 1210 



culture spread beyond the country of its origin. Not only did this 
people have a monopoly of the manufacture for many years, but 
so far as can be learned they successfully prevented the shipment 
of silkworms out of the empire, so that the material composing the 



















































































DEVELOPMENT OF PRODUCTION OF TEXTILES 167 

fabrics imported from thence by the Romans was a matter of 
curiosity and conjecture. It was supposed that silk was made from 
fleeces growing upon trees, or from flowers, tales evidently founded on 
slender facts connected indiscriminately with cotton, wool, and flax. 

To make a pound of raw silk requires from 2500 to 3000 cocoons, 
each cocoon furnishing a filament of perhaps 600 yards in length. 


Reeling Raw Silk in Japan 

Thus, if the cocoons were reeled separately, which, because of their 
fineness, is practically impossible, it would require about 1,800,000 
yards or a thousand miles of single silk filament to weigh a pound. 

The raising of silk is distinctly hand work and no machinery 
has been able to replace the hand work effectively. Hence the 
work must be done in countries where hand labor is cheap. To 
illustrate, even today the wages are as follows: In Italy the girls 
may get as high as 40 to 60 cents a day for eight hours’ work. In 
Japan they work from 5 o’clock in the morning to 5 o’clock at night, 
though one hour is taken out for tea and meals. For these 11 hours 
of labor they receive from 25 cents to 45 cents a day. Both in 
Italy and Japan the women who do reeling at home earn only about 
half of these amounts. 









168 ECONOMICS OF CLOTHING AND TEXTILES 


During the long period in which the Chinese retained exclusive 
knowledge of sericulture the price of all silk stuffs was equivalent 
pound for pound to their weight in gold. Notwithstanding the 
excessive cost of silk and the restraints otherwise put on its use, 
the trade grew. 

Silk fabrics were so costly that only nobility could purchase 
them. To illustrate: The Emperor Aurelian (a.d. 273) refused 
to allow his wife to buy a silk shawl, because it was priced at 
literally its weight in gold. In the sixth century, during the 
reign of Justinian (518-527), silk had become an article of very 
general and quite indispensable use. At this time the raw silk 
used in Europe was still being imported from China, by way of 
Persia. 

Silk culture was considered so highly that even the noble families 
there could engage in it without degradation. Through Venice the 
industry was carried to other parts of Italy, and in the next century 
spread so that by 1300 there were several thousand engaged in it 
at Florence, and it was highly important in other cities such as 
Genoa, Modena, and Bologna. 

The care of raising silkworms has been developed to a point 
where it is a science called sericulture. 

The Feudal Period. In Europe for several centuries the people 
were usually divided into classes — the nobility, possessing many 
serfs and slaves, and the free men. Each family produced what¬ 
ever was required in the way of clothing, food, shelter, etc. The 
wealthier members of society began to accumulate land and capital 
and depended upon the services of their slaves and the serfs 
attached to their land to perform all the labor of producing goods 
that were utilized by the household or manor house. This was part 
of the feudal system. 

Under this system the land was held by lords under grant from 
the king. Attached to each lord were the various tenants of the 
village and surrounding land. These tenants were of various 
grades, from the slave to the freeman. The villeins or serfs were 
attached to the soil, in that they were not permitted to leave and 
were required to cultivate the land held by the lord. They were 
not really slaves, however, because they had certain holdings of 
land in their own right and could not be sold away from these 


DEVELOPMENT OF PRODUCTION OF TEXTILES 169 


holdings. Nevertheless, they were dependent upon the lord to a 
large extent and served him in various ways. 

The manor was a self-reliant household, raising all the food, 
manufacturing the clothing, tools, etc. There was practically no 
trade and no wage system. Most of the labor was agricultural in 
character, but there was some specialization in the way of crafts, 
such as blacksmithing, milling, spinning, and weaving, etc. The 
manor was the economic unit during the feudal period, and was in 
turn superseded by the town. 

Rise of Handicrafts. As members of communities began to find 
that they could do certain operations in the making of yarn (spin¬ 
ning), cloth (weaving), clothes (tailoring), and shoes (shoemaking) 
better than others, they began to specialize and to do this work for 
others besides their own family. Then this work was no longer 
done in the home of the consumer. The worker bought his raw 
materials, bought and used his own tools, manufactured the 
product, and sold it to the consumer. Practically all goods 
were made to the order of the purchaser. This was the be¬ 
ginning of the handicraft period, and with its rise trades began to 
separate. 

The feudal ages in England and on the continent are representa¬ 
tive of the industrial life of such a civilization. After the break¬ 
down of the feudal system, which had almost disappeared from 
England by the end of the 16th century, we find that the de¬ 
velopment of craft specialization went on at a rapid pace and 
the handicraft stage of production replaced the old household 
system. 

Today we have only a few tradesmen, such as the tailors, dress¬ 
makers, and cobblers, who follow this method of production. 
The old-fashioned methods of shoemaking and repairing illustrate 
the way work was performed during the handicraft stage. 

Westward Trend of Industry. As civilization passed from the 
east to the west, Asia and Egypt gave to Greece and Italy the 
knowledge of spinning, weaving, etc. Italy and Greece used the 
information and then taught Spain, France, and Flanders (Bel¬ 
gium) the art of weaving wool and cotton. 

Later Germany received the textile arts — spinning and weaving 
— and passed them on to England and northeastern Europe, so 


170 ECONOMICS OF CLOTHING AND TEXTILES 


that by the tenth century the English were spinning and weaving 
the wool from their flocks with much skill, although not equal to 
the French and Flemish. 

With the invasion of William the Conqueror, 1066, came a large 
immigration from France, that settled in the part of England oppo¬ 
site the Irish coast. The new immigrants, and later ones during 
Queen Elizabeth’s period, increased the skill of the weaving and 
laid the foundation of the great textile centers of England — 
Lancashire and Yorkshire. 

Spinning Wheel. Spinning by distaff and spindle was the only 
means of producing a textile thread through the long period of 
thousands of years; so long, indeed, that mankind seemed to have 
settled down to the conclusion that there could be no other method. 
But with the development of the specialization of spinning and 
weaving came a desire to improve on the methods. Workmen 
with skill in this special work soon began to apply mechanical 
movements to the processes of spinning and weaving so they could 
utilize their energy to maximum capacity. Out of this desire 
came the invention of the spinning wheel and larger looms. The 
exact date at which the one-thread wheel was introduced is in some 
doubt and uncertainty, though it is comparatively a modern inven¬ 
tion . The one-thread wheel enabled 
the spinner to produce seven times 
more yarn than by the distaff. This 
method of spinning came into general 
use in Europe at the latter end of the 
15th century, or at the beginning of 
the 16th, and continued to be the 
most expeditious mode of spinning, 
both in that country and America, 
till the Hargreaves jenny appeared 
in 1764. Two kinds of household 
spinning wheels were used in the old 
days, according to the variety of 
fiber to be spun. The first was known as the /‘big wheel ” or “ wool 
wheel,” because of the magnitude of its rim and the fact that it 
was used in spinning sheep’s wool. The second was known as the 
‘‘flax wheel” and was smaller in size. 



Spinning Wheel for Flax 







DEVELOPMENT OF PRODUCTION OF TEXTILES 171 


The formation of a thread by means of these one-thread spinning 
wheels represented two independent operations. First, the large, 
loose, spongy strand of fiber turned off from the hand card was 
drawn out slightly into a smaller strand called a “roving.” This 
roving was next drawn out 
and twisted into a fine, solid 
thread. The two operations 
were very similar; in each 
case the spinster, after hav¬ 
ing attached the end of the 
roving to the spindle, seized 
it a few inches from the end 
with the finger and thumb 
of the left hand, and while 
she drove the wheel with the 
right in order to make the 
spindle revolve, she slowly 
stretched the coarse strand 
by drawing her hand from 
near the spindle to the posi¬ 
tion in which it is placed in 
the accompanying illustra¬ 
tion. She next completed the torsion by turning the wheel in the 
opposite direction, and wound the thread on the spindle into a 
conical shape called a “cop.” Yarn produced in this way could be 
used for both warp and weft. Only one thread could be spun at 
a time by this method, but the main operations carried out on the 
old spinning wheel — drawing, twisting, and winding, — have their 
exact reproductions in the monster spinning machines of the modern 
factory. 

Draw Loom. During the Dark Ages of Europe, a great improve¬ 
ment in weaving seems to have been invented in the East. This 
was the draw loom, which made much easier the repetition of a pat¬ 
tern. The principle made use of was to divide the number of 
threads of the warp into as many equal sections as the number of 
times the pattern was to be repeated in a width of the goods, and 
fasten all the similarly numbered threads of each section to one 
cord. When this cord was drawn, all the corresponding threads 



Spinning a Thread of Wool 






172 ECONOMICS OF CLOTHING AND TEXTILES 


would be lifted at once. At that time a helper was necessary to 
draw the cords governing the warp, but this was later done by 
machinery. 

Beginning of Marketing. The craftsman, such as the weaver, 
always produced more than he required and exchanged the product 
of his labor — cloth — for the product of another person’s labor, 
such as food. Thus we see that in this period we have the begin¬ 
ning of commerce — the exchange of goods — and the development 
of a group of middlemen who carry on trading. They purchased 
the products of the various craftsmen and relieved them of the 
necessity of finding a market for their own product. 

Since the system of bartering or direct trading of one kind of 
goods for another has many disadvantages, there arose the necessity 
for a medium of exchange which would serve as a basis for trading. 
Thus early in the handicraft stage we find the beginnings of the 
use of money as a medium of exchange. 

During this stage we find the rapid development of cities, par¬ 
ticularly in the northern parts of Italy. The cities became centers 
of certain types of manufactured commodities, such as velvet 
fabrics. Since there was a division of labor, the workers naturally 
clustered together so they could easily exchange goods. Many 
of the workers in the cities became wealthy and purchased their 
freedom from the feudal lords. The serfs ran away from the 
country sections to the cities, where they were free after a certain 
length of time. Gradually workmen began to band together and 
form guilds. 

The Guilds. As communities became larger and cities sprang 
up, industry became more than & family concern. Thus we find 
that in the textile industry group production soon began to sup¬ 
plant individual workmen. There was a demand for better fabrics, 
and to meet this demand it became necessary to have a large supply 
of different parts of looms. The small weaver, who owned and 
constructed his own loom, was not able to have all these parts, so 
he began to work for a more prosperous weaver. The same condi¬ 
tions applied to spinning, which in time came to be carried on by a 
class distinct from the weavers. As a result, the small weaver was 
driven out by the growth of organized capital, and a more perfect 
organization, called the guild system, arose. By this system, the 


DEVELOPMENT OF PRODUCTION OF TEXTILES 173 


textile industry was carried on by a small group of men called 
masters, employing two, three, or more workers (distinguished 
later as journeymen and apprentices). The masters organized 
associations called guilds and dominated all the conditions of the 
manufacture to a far greater extent than is possible under present 
conditions. 

These craft guilds were in some respects like the modern trade 
union, but were made up of independent craftsmen and hence 
were much more powerful. Their chief function was to protect 
each other and to secure honest workmanship. Their regulations 
were very strict, and none but guild members were permitted to 
carry on work in the town. A system of apprenticeship was 
introduced to limit the number of qualified craftsmen and to 
insure thorough training. Conditions of work were regulated, 
remuneration was determined, and style and quality of work were 
fixed by the guilds. Children of members were looked after and 
taken care of until they reached the age to enter the guild. Each 
guild had its own building in the various cities. 

During the period of the guild system the city was the economic 
unit and every effort was made by the guilds to increase the wealth 
and power of the city to which they belonged. Municipal regula¬ 
tion of commerce was very extensive, and rivalry between towns 
was similar to that between nations. There might even be cus¬ 
toms barriers, and any trading conducted by outsiders was care¬ 
fully supervised to protect the interests of the townspeople. 

There was a guild of silk throwers at Spitalfields, London, 
in 1562. 

Handicraft Stage and Action. With the increase of population 
came the desire of families to congregate and live quite closely 
together, thus causing the increase of town life and the growth of 
larger communities. Then towns began to develop rapidly during 
the fourteenth and fifteenth centuries. 

With the development of community life came the idea of 
specialization. One might, of course, say that specialization began 
in a small way when the husband hunted for game and his wife 
prepared and decorated the skins for clothing. But the principle 
of division of labor was really introduced only after the beginning 
of town life and the development of larger communities. It implies 


174 ECONOMICS OF CLOTHING AND TEXTILES 



a form of interdependence of the members of a community. When 
a group of persons can provide all the necessities of life without 
the assistance of an outside group, we say that they constitute 
an economic unit. With social organization and division of labor 


Handicraft Looms in Quebec 

Handicraft methods are still used in the Province of Quebec, where the 
farmers and their families utilize their leisure time in making their cloth¬ 
ing from the wool of their sheep. They receive only five cents a pound 
when they sell their wool, hence the wisdom of utilizing it. 

the economic unit becomes larger and larger. Thus the first eco¬ 
nomic unit was an individual, followed in turn by the family. 

The Domestic System. The change from the handicraft system 
of manufacture, as carried on by the guilds, to the system of do¬ 
mestic production was very gradual. The worker ceased to be 
an independent craftsman and became a wage-earner. The work 
of manufacturing was still done in the home, without power ma¬ 
chinery and with only a few assistants, but the craftsman now pro¬ 
duced goods for a merchant or middleman rather than for the 
customers themselves. The merchant owned the raw material, 
which was given to the worker for manufacture, and then the 
finished product was returned to the merchant for sale in the 
market. Thus we see the beginning of the worker furnishing 







DEVELOPMENT OF PRODUCTION OF TEXTILES 175 

the skill and the tools, while the capitalist provides money for the 
raw material and selling the product. This system of industry 
prevailed from about the end of the 15th century to the middle 
of the 18th century, when we find the beginnings of the Industrial 
Revolution that was to end in the establishment of the factory 
system of production. 

Cotton Manufacture. From Venice, Milan, and other Italian 
cities, cotton manufacture made its way to the Netherlands, from 
whence it was brought to England by Protestant refugees early 
in the 17th century. At this time (1600-1650), cotton fabrics, 
such as fustians, dimities, diaper, thicksets, cords, and velveteens, 
were woven chiefly about the town of Bolton, near Manchester, 
in Lancashire, and were purchased there at the weekly market 
by the Manchester dealers, who afterwards finished them in 
various ways according to the particular market for which they 
were intended. 

There can be no better illustration of the truth of the old saying 
that “ necessity is the mother of invention’’ than the early history 
of cotton manufacture and the difficulties under which the pioneers 
of the industry labored. The middle years of the 18th century 
represent the dividing line between the old and new processes. 

Cotton was first cultivated in America by some Virginia colonists 
in 1621 as an experiment. In the year 1728, among the exports 
from Charleston, S. C., were seven bags of ‘‘cotton wool,” valued 
at $16 a bag. For what port they were destined no one knows. 
The importance of cotton was very insignificant up to the time 
of its introduction into the agriculture of South Carolina. Prior 
to this, wool, flax, and silk were the chief materials of which clothing 
was made. 

Until the invention of Whitney’s cotton gin, the cotton plant, 
although marvelously well suited to our soil and climate, was 
limited in its uses by the great difficulty and expense of separating 
the seed from the fiber. But for the cotton gin, cotton textures 
today would command a far higher price than those composed of 
linen, and in the nature of things would be more highly prized. 
Upon the perfection and adoption of Whitney’s appliance, however, 
cotton rose at once to the highest commercial importance. The 
immense areas of uncultivated land in the South seemed provi- 


176 ECONOMICS OF CLOTHING AND TEXTILES 


dentially provided for the accommodation of the great crop. Its 
introduction energized the Southern people and opened a wide 
field for exertion. New labor and capital were introduced from 
abroad or transferred from surrounding States, and under the 
impulse thus given to the industry, wealth and refinement spread 
through the land, and that progress which is ordinarily the slow 
result of years was realized immediately. Since 1792, the year 
of the invention of the saw-gin, the increase of the cotton-growing 
interest has steadily progressed. Starting from comparatively 
nothing, it has reached enormous proportions, the crop of 1931 
reaching nearly 50,000,000 bales. 

From Greece and Italy the knowledge of linen manufacture 
traveled westward to France and Flanders, and thence into Ger¬ 
many and England. From these countries it made its way to 
Russia, Austria, Holland, Belgium, the north of Ireland, and Scot¬ 
land. In all of these countries linen was the fabric most largely 
in use until the introduction of cotton. The invention of the 
spinning frame, the spinning jenny, and the spinning mule in the 
latter part of the 18th century, benefited almost exclusively 
the spinning of cotton, and the immediate growth and develop¬ 
ment of cotton manufacture, largely due to these inven¬ 
tions, gave the linen industry as it then existed a fatal blow. 
Household spinning and hand-loom weaving immediately began 
to decline. The trade that had supported whole villages and 
provinces entirely disappeared, and linen manufacture, in a crippled 
condition, took refuge in specially favored localities, particularly 
in Ireland, Belgium, Scotland, and Germany, where it has resisted 
with varying fortunes the continued assaults of cotton. Scores 
upon scores of linen fabrics once in high esteem and extensive 
use are now unknown, or are remembered solely by their cotton 
substitutes. Among Western nations flax was, without any com¬ 
petitor, the most important of all vegetable fibers till toward the 
close of the 18th century, when cotton after a brief struggle super¬ 
seded it as the supreme vegetable fiber of commerce. The power 
machinery obtained better results in cotton than in linen manu¬ 
facture. 

In 1671 Edmund Blood obtained a patent for carding and spin¬ 
ning waste silk, which was probably the first successful attempt 


DEVELOPMENT OF PRODUCTION OF TEXTILES 177 

in Europe to do so. A patent of 1678 was to use a device in¬ 
stead of a helper to draw the cords controlling the warp on a 
draw loom. 

Early Woolen Manufacture. For several hundred years prior 
to the latter part of the 18th century England’s principal textile 
industry was the production of woolen goods. There are two 
districts in England that specialized in clothing: one imported 
Spanish wools and supplied raw material to spinners and weavers 
in Yorkshire, and the other supplied native wools for use by crafts¬ 
men who were also farmers, in Lancashire. The fathers and sons 
worked on the farm and in spare time worked at the looms, while 
the women, children, and old people were engaged in the carding 
and spinning. It required from six to eight people to do the 
carding and spinning necessary to produce sufficient yarn for a 
single loom. Every one from seven to eighty years of age found 
employment either carding, spinning, or weaving. 

In the latter part of the 17th century the East India Company 
imported large quantities of printed cotton cloth that became 
fashionable and threatened by its popularity to reduce the sales 
of leading English woolens. Parliament passed a law in 1700 
prohibiting the importing of printed cottons. In order to meet 
the demand for cotton goods a cotton industry was established 
in Manchester, and the cotton was supplied from India through 
Liverpool, a near-by seaport town. The woolen manufacturers 
tried to suppress the manufacture of printed cotton by having 
a law passed, but it was amended in 1736, allowing linen warp and 
cotton filling fabrics to be printed. 

Merchant manufacturers arose in 1740 in response to a demand 
for a group to sell fabrics. The merchant manufacturers gave 
out raw materials and received the cloth and paid for carding and 
spinning. They dyed and sold the cloth. At first the cloth was 
carried on pack horses. 

From the ranks of the craftsmen of the handicraft period — the 
carpenters, millwrights, weavers — came the men who invented 
the mechanical devices that solved the problems of meeting the 
clothing needs of the communities. The small capitalists — 
merchant manufacturers — of the handicraft period provided the 
organizing ability and business technique 4o take the inventions 


178 ECONOMICS OF CLOTHING AND TEXTILES 


and organize the factory-mill that has existed since and been a 
force for the industrial development of the world. 

The Industrial Revolution. During the last half of the 18th 
century, England, through her statesmen and industrial leaders, 
set out to supply the rest of the world with all her finished com- 



Winding on Spools'— 1750 


modities, and especially with textiles. England at that time had 
an abundance of capital, since London was the financial center 
of the world. It had also a large supp.y of free labor, since the 
feudal system had ended by the beginning of the 16th century 
and there had developed a large body of artisans steeped in the 
traditions of craftsmanship, particularly of hand spinning and 
hand weaving. There was great need for more efficient equip¬ 
ment to turn out sufficient textiles to supply a world market. Up 
to 1760 the same type of machinery was in use in England that 
had existed in India for centuries — except the spinning wheel. 
With the greater demand for cotton goods it became necessary to 
discover some better way of manipulating the fiber in order to 
increase production. 

The English guilds had mechanical ability equaled by no other 
nation at that time. We must remember that the great English 






























DEVELOPMENT OF PRODUCTION OE TEXTILES 179 


woolen guilds were first established in 1300. For centuries they 
were a power in British affairs. In 1350, a guild member, Thomas 
Blanket, invented the utilitarian commodity that bears his sur¬ 
name. 

The relation of employer and employee dating from the guilds 
still remained, and left a strong group of more or less organized 
employers who set to work to develop inventions that would in¬ 



crease production per worker and would produce a variety of 
textile products. This meant a revolution in the industry as 
carried on in the home, and required a larger unit, composed of 
employer, many workers to carry on weaving, spinning, or dyeing, 
and a corresponding group of learners or apprentices. 

During the last half of the 18th century the first mechanical 
devices appeared for the utilization of horse power. These were 
rapidly succeeded by devices using water power, and later by the 
steam engine. 

In weaving cloth more than 36 inches wide in the old hand-loom, 
it was necessary to have two weavers for each loom so as to 
throw the shuttle across the width of the cloth. One person’s 
arm was not sufficiently long to extend across the loom. 

In 1733, Kay obtained a patent for a flying shuttle to be used in 
weaving. This placed a shuttle box at each end of the reed, or 
bed, along which the shuttle had previously been slid by hand. 
In each box was a picker or hammer, which was fastened by a 
cord to the picking stick. When the stick was jerked, the picker 
or hammer struck the shuttle and sent it flying across its bed, or 
shuttle race, between the threads of the warp, into the other 












180 ECONOMICS OF CLOTHING AND TEXTILES 

shuttle box. Each shuttle was about ten inches long and contained 
a bobbin, or quill, wound with woof, so that Kay’s invention made 
the action of weaving almost continuous. It was a number of 
years, however, before it was extensively used in silk weaving. 

This mechanical device increased the production of a loom 
100 per cent. It also allowed the weaving of any width of fabric. 


Cloth-Making by Two Weavers 
French-Canadian farmers 

The increased production of cloth called for an increased amount 
— 100 per cent — of yarn, which could not be produced by the 
hand cards and spinning wheels. While it had required from 
six to seven workers to supply yarn for each weaver, the new 
invention required from twelve to sixteen people to supply it, 
and it was impossible to secure at once the amount of yarn 
needed. The price of yarn increased under such pressure and 
became the one topic of discussion in every workshop. Out of 
this discussion came a number of inventions, and that of the 
spinning frame took place in a short time. 

The first spinning machine was called spinning jenny, named 
after the inventor’s daughter, Jane. This machine was invented 
















DEVELOPMENT OF PRODUCTION OF TEXTILES 181 


by James Hargreaves in 1767 and was very simple and suitable for 
driving by hand. The invention came about through an accident. 
Hargreaves, a carpenter, happened to stumble against the Saxony 
spinning wheel belonging to his wife and broke it. In repairing 
it, the thought occurred to him that by setting the spindle vertically 



it might be adapted to work upon the manifold system. His fifth 
jenny, made in 1786, operated one hundred spindles and was 
driven by water power. Alarmed by his invention, the indignant 
hand spinners — who may or may not have had a vision of the 
economic evils of mass production — attempted to mob him. 

In order to understand the development of the spinning machines 
we must remember that in making or weaving a piece of cloth it 
is necessary to have two kinds of yarn or thread, one for the 
warp and the other for the filling. Since the warp is the founda¬ 
tion of the cloth, in weaving this yarn must be a little stronger 
than the filling. This added strength is secured by providing 
more twist in the warp than in the filling yarn. 

Textile machines attempt to perform by mechanical devices the 
motions and technique of the fingers and hand. The work done 
by the fingers of the hand spinner consists of two distinct opera¬ 
tions : (1) the stretching and drawing out of a piece or strand of 
carded cotton, (2) the twisting of these drawn-out fibers into 

















182 ECONOMICS OF CLOTHING AND TEXTILES 


threads. Since it is impossible to perform these movements in 
one operation, it is necessary first to spin the cotton into a coarse 
thread called a roving and by a second operation complete the 
drawing out and twisting into finished yarn. 

The yarn made on Hargreaves’ machine was suitable only for 
the filling, as it did not have the required twist for warp. Ma¬ 
chines for producing the warp yarn were made by different crafts¬ 
men, but the most successful was developed by Richard Arkwright 
in 1769. It consisted of two sets of rollers moving at different 
velocities. These rollers took the place of the fingers in hand 
spinning. The lower rollers were fluted and the uppers covered 
with leather. The front rollers moving faster exerted a pull on 
the cotton, but with much more speed and regularity than the 
fingers in hand spinning. Beneath these rollers were spindles 
revolving at great speed, on which the twisted thread was wound. 

Machine Spinning. With the advent of the Hargreaves jenny, 
machine spinning may be said really to commence. By means of 
this device one person could spin from ten to sixty threads at one 
time and by one operation. Though called a hand jenny, it was 
to all intents and purposes a machine, as its size was limited only 
by the ability of human strength to work it. At the time of its 
introduction (1767), six spinners working with one-thread wheels 
were required to keep one weaver going, so that the jenny came 
into being in response to an urgent demand. The Hargreaves 
jenny was constructed on the principle of the spinning wheel; 
several spindles (from 10 to 60) being made to whirl by one fly¬ 
wheel, while a movable frame or carriage, representing as many 
fingers and thumbs as there were threads, ran back and forth from 
the spindles, thus extending the loose rovings of fiber in almost 
exactly the same manner as the hand of the spinster. When the 
yarn was drawn out a short distance, the carriage, by an ingen¬ 
ious mechanism, was made to recede, and as it approached the 
spindles the yarn was wound up. 

Within two years after the invention of the jenny, Arkwright 
perfected his roller spinning water frame, and we reach a very 
important period in the history of modern spinning. The perfect¬ 
ing of the roller spinning frame by Arkwright introduced into the 
textile industries an entirely new mode of spinning — one that 


DEVELOPMENT OF PRODUCTION OF TEXTILES 183 


had not to any degree been in use before. All textile threads 
before Arkwright’s machine appeared had been produced on the 
same principle, the original principle of drawing out and twisting 
at the same time — of distaff and spindle, the one-thread wheel, 
and the Hargreaves jenny. The Arkwright frame, however, 



Multiple Spindle Spinning Machine 
Invented by Thomas Highs 


brought into use a new method of spinning, and converted the 
spinning of the various classes of yarns into two distinct processes. 
In the Arkwright roller frame, the soft, loose rovings from the 
carding room were drawn out into thread by means of several pairs 
of rollers, arranged in sets. The upper roller of the first pair was 
covered with leather and the lower roller, made of metal, was 
fluted in order to keep a firm hold on the strands of fiber as they 
passed through. Another similar pair of rollers was placed directly 
in front of the pair just described. The second pair, however, was 
made to revolve at a greater velocity than the first, thus pulling or 
drawing the yarn from the latter. If the surface of the second pair 
moves at twice or thrice the velocity of the first pair, the yarn, as 





























184 ECONOMICS OF CLOTHING AND TEXTILES 


will be readily understood, will be drawn out twice or thrice as fine 
as it was. In order to reduce the yarn to the desired fineness this 
operation was repeated two or three times, or until the stand was 
rendered as fine as possible without danger of pulling it apart. As 
the half-formed thread emerged from the rollers the last time it 



The Roving Frame 


was attached to a spindle and twisted to the requisite degree in 
order to make it sufficiently strong to bear the tension of weaving 
and the after processes. In this manner the rollers and spindles ac¬ 
complished what was formerly the work of the finger and thumb 
of the spinster. 

Previous to the introduction of the Arkwright frame, in 1769, all 
textile threads were drawn on one principle, but since that time 
two principles of drawing have been employed, and consequently 
two systems of spinning have resulted. In the new principle of 
spinning, the spindle has nothing whatever to do with the drawing, 
that is, the extending of the yarn; this is done entirely by the 
rollers. In the old principle of spinning the drawing is all done 
by the spindle. By the roller method is spun all worsted, flax, 
cotton (except the high numbers), hemp, jute, mohair, alpaca, and 
spun silk — in fact all the solid, wiry, bare, non-covering class of 






























DEVELOPMENT OF PRODUCTION OF TEXTILES 185 


yarns; the other class comprises woolen and all soft-spun yarns, 
which are not roller-drawn, but spun on the old principle of the one- 
thread wheel and the Hargreaves jenny. 

A decade after the roller spinning frame, which was driven by 
water power, came the invention of the spinning mule, a combina¬ 
tion of the jenny and the frame. 

The invention of the power spinning machine again disturbed 
the balance between the output of the loom and the spinning frame. 
The new cotton yarn mill made yarn faster than the weavers could 
use it. Therefore the need was for a power loom, which was in¬ 
vented in 1785 by the Rev. Edmund Cartwright. It was bitterly 
opposed for many years by hand weavers, and it was not until 
1800 that it was introduced into the mills. Samuel Cunliffe 
Lester devised the wool-combing machine, completing the cycle 
between the raw product and the finished cloth. All this occurred 
between 1770 and 1785, when the machines were attached to the 
device that James Watt had dedicated to industrial progress — 
the steam engine. 

The first cotton mills were on banks of rivers to secure water 
power, but later the steam engine was introduced, which made it 
possible for mills to be erected near source of raw materials, and 
centers of population. 

England had developed by the end of the 18th century a system 
of manufacturing textiles on a large scale, both quickly and 
cheaply. The industry had moved from the home and small 
shops into a larger establishment, called a factory. No other 
country could compete with the English industry because of its 
monopoly of machine methods. 

The first factory system — a cotton mill — was organized and 
operated in Nottingham in 1769. The first steam-power mill was 
opened in England in 1785. In 1790 Samuel Slater, working from 
memory of his experience in an English mill, erected cotton ma¬ 
chinery in America. But it was not until some time after the 
Revolution, in 1807, that power-driven machinery began to appear 
in this country. 

Crawford, a London merchant, patented in 1780 a silk doubling 
frame, which is notable because it included the first attempt to 
have a machine stop automatically when a thread was broken. 


186 ECONOMICS OF CLOTHING AND TEXTILES 


Another invention of that year was printing from plates, by Bell, 
who developed this into roller-printing in 1785. 

Because England had forbidden the export of textile machinery, 
and attached heavy penalties to violation of this law, the United 
States found itself directly after the Revolution in great straits to 



Arkwright’s Mill at Crawford 


secure equipment essential to meet the growing apparel needs of 
the young nation. From the beginning of colonial history to the 
early part of the 19th century the hand-card, the spinning wheel, 
and the wooden loom, operated by hand or foot, were almost as 
common in the farmhouses of this country as the clock and the 
sewing machine are at the present time. There are women now 
living who in their girlhood spun home-grown flax and wove it 
into linen for their bridal outfits, and who in their early wifehood 
spun from wool the yarns they knitted into stockings or wove into 
cloth for their family’s ordinary wear. For a long period in our 
history these rude hand implements supplied to a considerable 
extent the textile fabrics consumed by a large proportion of the 
population. The power-loom (invented in 1787) did not find 
favor as readily in America as it did in Europe, and in England 
particularly it was firmly established many years before it was 
generally adopted in this country. Even when the factory system 
had superseded the domestic industry in the production of textiles, 
the hand-loom continued to be employed almost exclusively until 






DEVELOPMENT OF PRODUCTION OF TEXTILES 187 


about 1850. In the weaving of carpets, hand-looms continued 
to be used until 1860, and in Philadelphia as late as 1870, at which 
time the adoption of the power-loom in this industry became 
universal. 

Up to 1870 hand-loom surpassed power-loom. In this period 
power-looms passed hand-looms in total number. In 1875 there 
were 1428 of the former as against 1005 of the latter. 

The Factory System. With the introduction of the steam engine 
about the middle of the 18th century, we find the end of the domes¬ 
tic system of manufacture and the beginning of our modern factory 
system of industry. The heavy, expensive machinery could be 
purchased only by wealthy owners or corporations and operated 
on a principle of mass production. The small weavers and spinners 
could no longer compete with the machine production and were 
gradually driven from their small shops into the factories. The 
change from the domestic to the factory system occurred very 
rapidly and caused much suffering and poverty among the textile 
workers by throwing out of employment many of the hand workers. 

The idea of liberty, in industrial activity as well as in personal 
behavior, that had been introduced by the Declaration of Inde¬ 
pendence and the French Revolution, hastened this change in the 
manner of production and the adoption of new methods, thus 
heightening the suffering caused by the revolution in industrial 
processes. Formerly the government had actively interfered in 
the development of industry, regulating the prices of textile prod¬ 
ucts, and exercising a directing influence upon trade. With the 
introduction of the factory system came also greater freedom of 
competition and private enterprise. The government regulated 
only patterns, copyrights of trade marks, and patents to the 
inventors of new machinery. 

The manufacturers began to develop a science of factory organi¬ 
zation, including the specialization of work, elimination of waste, 
and invention of machinery to take the place of many hand opera¬ 
tions. All of these devices increased production, lowered the price 
of cloth and clothing, and destroyed the competition with hand- 
woven and hand-made clothing. As the result of greatly increased 
production, the market was at times flooded with clothing, which 
frequently meant loss of work on the part of the em’ployees, and at 


188 ECONOMICS OF CLOTHING AND TEXTILES 


times reduction in wages. The hours of labor were long, and 
children were long employed in textile mills. In fact, in many cases 
only the combined earning power of the father, mother, and 
children was sufficient for a living wage. 

Prior to the Industrial Revolution, in the pre-machine age, there 
was marked stability in society. A settled population, fairly evenly 
distributed and slowly increasing in numbers, with industrial labor 
in close contact with the soil insured a self-sustaining and well- 
balanced relation between the necessities of labor and earning 
power, so that prices, wages, rents, and employment were fairly 
constant, except at times of occasional flood or crop failure. 

Each invention of machine or process during this period dis¬ 
turbed and in some cases upset the economic balance between the 
number of workers and the work to be done, which caused unem¬ 
ployment, poverty, and much unrest among the people of the 
community. 

While the industrial revolution and the factory system did not 
create the capitalist and the poor workingman, they did create a 
condition that allowed greater development of these two classes, 
and produced overcrowded industrial centers. The poor working¬ 
man depended upon his job for an existence, and children at the age 
of six or seven toiled up to fifteen hours a day in unsanitary mills. 

Machine Age. The first part of the factory system was called 
the Machine Age, and is represented by the 19th century. During 
this time work hours were steadily reduced as new machinery took 
over the tasks performed by men, and the men thrown out of em¬ 
ployment were absorbed into new positions created by shortening 
of hours and increased production. 

The greatest development of labor-saving machinery has taken 
place in the United States, where all types of machinery, tools, 
automatic devices, conveyors, and various kinds of controls have 
been gradually introduced. 

Power Age. But with the opening of the 20th century the 
Power Age came into existence and electric power tools were sub¬ 
stituted for machine tools operated by man. Electric power 
makes possible intricate sensitive tools. While a gang of men in 
the machine age operated a group of machines, in the power age 
one mechanic supervises several gangs of machines. This has 


DEVELOPMENT OF PRODUCTION OF TEXTILES 189 


been multiplied until today with power machinery one man can 
accomplish as much as 45,000 men and women with their hand- 
looms and spinning wheels of two centuries ago. 

During the Power Age unemployment has increased faster than 
during the Machine Age. This has occurred because hours of 
labor have not decreased proportionately and also because con¬ 
sumption has not increased proportionately. 

Many abuses and evils that were not in the interest of society 
thus followed in the wake of the factory system. Selfishness, greed, 
and grasping for profits caused many of these abuses, and some¬ 
what detracted from the positive advantages that were to be 
obtained from the increase in production and the labor-saving 
devices that mass production had made possible. Such abuses, 
however, are pretty widespread in human nature, and were not 
peculiar to the factory system although they flourished there during 
the early competition. Various laws have been passed in later 
years to eliminate these abuses. The Sherman Anti-Trust law has 
been passed to curb combinations and monopolies in industry; 
child labor laws have been enacted; the Federal Trade Commis¬ 
sion and the Interstate Commerce Commission have been given 
certain powers of regulation; and workmen’s compensation laws 
have been passed. In these and other ways the United States 
government has sought to counteract the worst features of mass 
production and to protect the workers and the consumers. 

Periods of depression have taken place about every ten years 
during the last half century under the factory system. Most of 
these depressions have been due to maladjustment of production 
and consumption. 

The Factory System in the United States. The first cotton mill 
in the United States to be operated upon the factory system was 
erected in 1787 at Beverly, Mass., by a stock company, at an 
outlay of about $20,000. So great an interest was felt in this enter¬ 
prise that the State legislature assisted it with an appropriation of 
$6000. In 1789-91, machinery for carding and spinning cotton 
(after Arkwright’s and other English inventor’s methods) was set 
up in Rhode Island and elsewhere. Previous to this time America 
had no cotton factories, goods of this description being either 
imported from the mother country or produced by hand processes 


190 ECONOMICS OF CLOTHING AND TEXTILES 



in the homes of the people. With respect to the establishment of 
the cotton manufacture in the United States, special credit is due 
to Samuel Slater, a native of England, who emigrated to this 
country in 1789. In the following year he made with his own 
hands a series of Arkwright machines, and started at Pawtucket, 
R. I., a cotton-spinning factory. In 1794 he made the first cotton 


View in Slater’s Mill 

sewing thread. In 1806, the firm of which he was a member 
founded the village of Slatersville, R. I., where they put into success¬ 
ful operation most of the new improvements then used in England. 
By 1810 many of Slater’s models were in use by others, and factories 
had been established in Connecticut, Pennsylvania, New York, 
Massachusetts, and other States. The weaving of cotton cloth was 
done by means of hand-looms until the latter part of the year of 
1813, when there was started at Waltham, Mass., the first mill in 
the United States in which power-looms were used. 

European Textile Factories. Every branch of textile working 
in Europe is the outgrowth of a household art. When new condi¬ 
tions appeared, due to the changing from hand-processes to 
automatic machines, each mill or small factory that sprang up 
specialized in one or another of the textile operations, such as wool 
washing, weaving, carding, or spinning. The manager of a weaving 
mill frequently knew little if anything of a spinning mill and vice 








DEVELOPMENT OF PRODUCTION OF TEXTILES 191 


versa. One of the results of this mill organization is that the 
manager of each establishment develops into a more competent 
man in his specific vocation than one who is hindered, like the 
mill managers of the United States, with the superintendence of 
all the processes involved in the converting of raw cotton or wool 
into finished cloth. On the other hand, the concentration in tex¬ 
tile work in America has tended to economy and improvement in 
textile machinery, particularly in the matter of speed. The 
fastest-running machines in the world, for the formation of so 
delicate a fiber as silk, are in operation in the silk mills of Paterson, 
N. J. So nice is their adjustment and so well perfected their 
mechanism that they run even more smoothly than the slower¬ 
geared machinery of Germany. 

Parallel with this improvement in machinery has been the 
progress made in the quality of goods produced. While the early 
American weavers turned out simple pieces — that is, plain silks — 
the American silk manufacturer today finds nothing too difficult 
for his skill or too expensive for the market. Slowly but surely 
the textile products of domestic manufacturers have crowded out 
foreign products, except for some novelty or new design in silk 
fabrics that the home silk-weavers of Germany have developed with 
the aid of the government. 

Germany is not famous for its cotton industry, which is still in 
a comparatively early stage of development; but its advance is 
shown in the history of Munchen Gladbach, where the chief cotton 
factories are situated. In 1860 the population of the city was about 
7000, today it is about 640,000, and the increase is due chiefly to 
the cotton industry. This compares with the progress of some of 
our southern cities. There is no doubt that Germany means to 
go forward with this branch of textiles. 

No foreign market can compete with the United States in the 
manufacture of shoes. In Germany the shoe manufacturers send 
out agents to find out what is wanted in the trade, and then attempt 
to manufacture ladies’ shoes, slippers, men’s and boys’ shoes in 
the same factory. Here, the manufacturer turns out a certain 
product, which is his specialty, and sells it wherever possible. If 
he manufactures several products, he has separate factories for 
them. 


192 ECONOMICS OF CLOTHING AND TEXTILES 


At the commencement of the 19th century, the chief silk-produc¬ 
ing regions of the world were the Levant (including Persia, Syria, 
and Broussa), India, Italy, and France, the two first named 
producing low-priced silk, and the other two the fine qualities. 
Between 1840 and 1850, after the opening of trade with China, large 
quantities of silk were sent from Shanghai and Canton. In 1857 



Wool Combing and Spinning Mills, Tollegno, Italy 
Foreign countries have up-to-date equipment and can compete very 
closely with the United States 


commenced the importation of Japan silk, which became a fierce 
competitor with Bengal silk and gradually replaced it in favor. 
China and Japan, both of which contribute so largely to European 
and American silk supply, export only their surplus growth, since 
silk weaving is carried on and native silk worn to an enormous 
extent in both countries. The opening of these lands to Western 
commerce has had not only the effect of cheapening silk and silk 
manufactures in general, but also has broadened the field from 
which the industry can draw its raw material. 

In the manufacture of silken fabrics, France occupies an impor¬ 
tant position among the nations. Not only is all the raw silk 
produced in France worked up within the country, but a very 
considerable portion imported from the Levant and China passes 
into the hands of the French manufacturers. Lyons is the head¬ 
quarters of the trade. In that locality, if the surrounding country 
be included, employment is given to about 120,000 looms, 25,000 



DEVELOPMENT OF PRODUCTION OF TEXTILES 193 


of which are driven by power. There are also important manu¬ 
facturers of silk at St. Etienne, Calais, Paris, Nimes, Tours, 
Avignon, and Roubaix. In Germany the principal seat of the 
silk trade is at Crefeld, which controls a large trade in cottonback 
satins, pure silk broad goods, and ribbons of all kinds. Barmen, 



View in Cotton Mill in Ecuador 


Elberfeld, Viersen, and Mulheim in Rhenish Prussia are also 
flourishing silk centers. Third on the list of European producers 
is Switzerland, where Zurich takes the lead with broad goods, and 
Basel rivals St. Etienne in the ribbon trade. Italy, the early home 
of the silk trade — the land of gorgeous velvets, damasks, and 
brocades — has fallen from its high estate, and now employs not 
more than 20,000 hand-looms. In England silk manufacture has 
been in a condition of decline since 1860, the date of the commercial 
treaty with France, by which silks were admitted into the country 
free from duty. The principal seats of the industry in England 
a t present are Spitalfields, Coventry, Nottingham, and Manchester. 

Attempts at Silk Raising in America. Various attempts have 
been made to encourage the raising of silkworms in this country. 
It was encouraged in 1657, when the Virginia Assembly offered 
10,000 pounds of tobacco to any planter who should export 
200 pounds worth of raw silk or cocoons in a single year; 5000 





194 ECONOMICS OF CLOTHING AND TEXTILES 


pounds of tobacco to any one producing 100 pounds of raw silk; 
or 4000 pounds of tobacco to any one producing silk exclusively. 
The bounty was withdrawn in 1666 and renewed in 1669, but it 
was never claimed. 

Land was given to settlers who would plant 100 mulberry trees 
for each 10 acres. In 1735 eight pounds of raw silk were sent to 
England and there thrown, woven, and presented to the Queen. 
Parliament in 1749 exempted from duty silk produced in Georgia 
or Carolina. The Connecticut Assembly in 1763 offered 10 shillings 
bounty for 100 mulberry trees planted and kept in good condition 
for three years; and another of three pence for each ounce of raw 
silk produced. In 1790 a woman and three children could in five 
weeks make 10 pounds of raw silk worth $50. 

All attempts to raise silkworms in America have failed. The 
fundamental reason for this is, not that mulberry trees and silk¬ 
worms can not, though with difficulty, be raised in this country, 
but that the production of raw silk is essentially a household and 
hand process still requiring, as in the days of ancient China, 
infinite patience and an altogether disproportionate amount of 
human labor. Even in Italy, during the silkworm season, the 
whole house, including the bedrooms and beds, is given over to 
the worms, upon which the women lavish every attention from 
daylight until late at night, and for all this trouble and work they 
net only about twenty-five cents a day. In Japan and China 
such household labor may bring as low as eight to ten cents a day. 

Silk can not be grown by the highly paid labor of the United 
States in competition with such meagerly rewarded oriental 
drudgery, nor can household hand labor compete here with other 
industries in which most of the energy is furnished by power and 
most of the work done by machinery. 

Ralph, Ward, and Frank Cheney, together with E. H. Arnold, 
on January 2, 1838, formed the Mt. Nebo Silk Mills at South 
Manchester, Connecticut, the first really successful silk manu¬ 
factory in the United States and the only one that has existed 
continuously from that date. 

The story of the Cheney silk mills is typical of the growth of the 
industry, and, even more than that, of the development of the 
United States from an agricultural to a manufacturing country. A 


DEVELOPMENT OF PRODUCTION OF TEXTILES 195 

number of details which have been preserved in old diaries show 
how crude was their beginning, as in fact was the start of most 
factories at that period. With an original capital of $50,000 this 
little group of pioneers planned to convert a barn into their first 
silk mill, and machinery was ordered built for delivery in April, 
1838. The barn idea, however, not proving feasible, it was de¬ 
cided to build a factory which was to be only 32 X 45 feet. It 



Original Cheney Hill 


is interesting to note that the hand hewing of the timbers cost 
four cents a foot and that the joiner’s work for the whole original 
mill was $262. When this work was done, the whole neighborhood 
turned out for an old-fashioned “ barn raising ” bee which took 
place on March 31, 1838. 

The power for the silk factory was taken from the bottom of the 
tailrace of a mill which served at different times for paper making, 
grist grinding, and distilling. A little undershot wheel was used, 
and there was all together only a six-foot fall. 

The invention of the sewing machine greatly increased the call 
for sewing silk, and created a demand for stronger and more even 
thread than had been used in hand sewing. Whereas in hand 
sewing the thread had been twice doubled and twisted, it was 
found valuable for machine sewing to combine three threads. 
The manufacture of machine twist was begun by the Cheneys 
as early as 1852, and soon developed into an important depart¬ 
ment. 

In 1857 the buildings were still of wood. The power still came 
chiefly from the brook and was furnished by two turbine wheels 








196 ECONOMICS OF CLOTHING AND TEXTILES 


of 20-horse power, each 26 inches in diameter. Steam was supplied 
for the dyehouse from two locomotive boilers. 

An invention of the ’fifties, made in the factory, greatly simpli¬ 
fied spooling, which had previously required one girl to attend to 
each machine. Frank Cheney and Grant, after only three months’ 
experimenting, evolved a spooling machine which enabled one 
girl to attend to three machines. This marked the third important 
improvement made by the Cheneys in silk manufacturing in a little 
over a decade. 

The tariff that was put on silk goods during the war in 1861 
made it possible to develop the weaving of silk far more extensively 
in this country. 

One important feature of the factory was the use, in doubling 
and twisting, of the new Rixford roller made for the Cheneys. 
This was turned only by friction, and hence would give a little in 
drawing out the silk, and thus avoid breaking it, as the former 
fixed rollers had been constantly doing. As this principle is 
well-nigh essential in working silk, the Cheney factory, even at 
its very inception, introduced an almost revolutionary improve¬ 
ment. 

The first energies of the company were devoted chiefly to sewing 
silk, which was made almost entirely from raw silk imported from 
the Orient. The American merchant marine was then at the 
height of its glory and the famous clipper ships were making their 
marvelous runs from the Far East in 90 to 100 days. Now, express 
liners of our reborn merchant marine land their cargoes of raw silk 
on the west coast in 11 to 14 days, and they are rushed by fast 
freight direct to Cheney Brothers’ mills, the total time from Yoko¬ 
hama taking as little as 20 days. 

Records of 1843 show that the average pay in the silk mill, 
employing both men and women, was only 51 cents a day. In the 
simple life of the day it was possible for a man to live, raise a 
family, and be a highly respected member of the community on 
this amount of money. In 1848 the wages of the men averaged 
$1.14 a day; of the women, 63 cents a day. The total average 
was 72 cents. 

Linen Manufacture in the United States. The modern history 
of linen manufacture has been curiously fitful. In the transition 


DEVELOPMENT OF PRODUCTION OF TEXTILES 197 


from a hand to a machine industry, linen lagged far behind cotton, 
wool, and silk. As the consumption of cotton goods marvelously 
increased and multiplied with the application of power to their 
manufacture, they literally drove linen out of the field, in the 
earlier part of the 19th century. By slow and costly steps, spin¬ 
ning and weaving machinery was gradually applied to flax, and 
the industry was fairly back in the race for competition again when 
our Civil War broke out and the world’s cotton famine followed. 
Then came a mighty impulse to the linen industry. Dundee and 
Belfast developed as centers of manufacture, and the consumption 
of all classes of linen goods increased throughout Europe and 
America by leaps and bounds. But when the war ended and the 
cotton supply again increased, the collapse was as sudden as the 
revival had been, and the production of linen fabrics has never 
since reached the volume it attained from 1861 to 1866. As a 
matter of fact, it has been declining from year to year, as is demon¬ 
strated by statistics of export and of machinery employed. 

Although more linens are consumed in the United States in pro¬ 
portion to population than in any other country, yet the manu¬ 
facture has never taken root here as compared with other textile 
industries, due to the excessive cost of hand labor required in the 
manufacture of linen. Since 1931 linen manufacture in the 
United States has improved, due to the invention of machinery 
in the Northwest for its manufacture. 

Survival of Handmade Textiles. With the invention of power 
textile and clothing machinery the demand for handwork became 
less and less. But at no time have the hand operations been com¬ 
pletely eliminated by machinery. To illustrate: It has been 
found impossible to provide machinery to make hair nets. Because 
of the fine texture of hair and the shortness of the strands, machin¬ 
ery will not knit the delicate nets. Hence all fashioning is done 
by the hands of Chinese natives. 

The making of customized clothes is still essentially a handicraft 

— but a handicraft developed along modern lines of efficiency and 
production. It is dependent on the skill of the individual workers 

— the great organization of expert tailors which has taken years 
to assemble. The human body is composed of curved surfaces, 
and the cloth is flat. To shape the fabric into curved places the 


198 ECONOMICS OF CLOTHING AND TEXTILES 

flat cloth must be pressed, stretched, and shrunk into proper shape 
by hand manipulation. This shaping is called “ padding,” and is 
very important in the formation of coat fronts, lapels, and collars. 

Attempts have been made to do this padding by machinery, 
but if the padding is done by machine, no curve is built into it. 
If the padding is done by hand, it is possible for expert fingers to 
manipulate the two pieces of cloth so as to give almost any curve 
desired. As you place the stitches, you hold the under cloth so 
that it is stretched out tight and you hold the upper cloth so as to 
gather it together and crowd it just a bit against the needle. As 
a tailor would say, you work in a little fullness with each stitch. 
When it is done, you find the double thick fabric is no longer flat: 
it curves. The cloth that was on the under side as you stitched 
is on the inside of the curves. 

Now the human body is nowhere flat. If coat front, lapels, and 
collar are padded by machine, they are still flat, and the curves 
must be pressed in or stretched and shrunk in. If the curves are 
developed by expert hand padding, they are truly tailored in. 
This hand padding costs eight times as much as the tight, flat 
stitching of a sewing machine. It is worth it. Besides this there 
is hand padding — and hand padding! Hand stitches taken 
without skillful working in of the curve might be no better than if 
done on a sewing machine. 

Felling the tape down the front edge of the coat by hand costs 
fully five times as much as to fell it on a sewing machine. The 
hand work gives a soft, smooth, flexible edge, and one that is thinner 
and more pleasing in every way than machine work. The hand 
felling is also a great safeguard against puckering. 

But to secure the easy comfort, fine lines, and lasting style of 
customized clothes, the band saw, the pressing form, and many 
other mechanical contrivances, and to a very large extent even 
the sewing machine, must give way to the slower, more costly, but 
much finer methods of the expert hand worker. 

Often finer effects can be obtained by hand than by machine 
sewing. Thus hand embroidery is softer, not so rigid, and more 
attractive than machine embroidery. During the 14th century 
the art of pictorial needlework or embroidery had developed as a 
fine art that surpassed paintings in many respects. The needle 


DEVELOPMENT OF PRODUCTION OF TEXTILES 199 


in the hands of the skilled artisan moved over the surface of the 
woven fabric like the brush of the painter, producing beautiful 
colored designs. Women during the early centuries were shut 
out of business, and used their leisure to cultivate the art of em¬ 
broidery. At first embroidery was restricted to the wealthy. 
Its general use and popularity among the masses was reserved for 
a recent period when embroidery machines were invented. No 
machine has produced the equal of an excellent oriental rug or 
carpet, because of the centuries of experience and training in 
creating the beauty and novelty of the pattern and the rich and 
harmonious colorings. No machine has been invented that can 
give the twist to the yarn and tie the square knots that are the 
peculiar features of the handmade fabric. In addition handmade 
rugs are the most durable in the world because they are built up 
knot by knot slowly, skillfully, and laboriously. Sheep are espe¬ 
cially bred to produce rug wool of the finest texture. An added 
interest in handmade rugs is that they bear the imprint of human 
labor — days, weeks, months, and even years of laborious toil. 
The story of human life may break into design — in its form, 
pattern, and colors. 

Some of the most exquisite manufactures of the world are 
carried on by the hands of peasants in remote valleys and mountain 
solitudes. The celebrated and unrivaled cashmere shawls, noted 
for their great elaboration and glowing harmony of design, are 
wrought by the patient natives of India, on rudely constructed 
looms. The finest and most sumptuous Smyrna rugs and Persian 
carpets are slowly put together on a loom built between two trees. 
The most enduring blanket to be had in any country is woven in 
the remoter parts of Arizona by Navajo squaws. 

It has been found that power looms, urged by steam or turbine, 
are too rough for the finer qualities of linen and cambric em¬ 
broidery, and for this work the fingers of Irish peasant girls are 
the best of all machines. The mummy wrappings show that with 
their crude machinery the ancient Egyptians produced linen fabric 
far exceeding in fineness any cloth that we can produce with the 
most modern mechanical inventions. 

There was a time in the history of our own country when the 
hardy pioneer clothed his family with better woolens and better 


200 ECONOMICS OF CLOTHING AND TEXTILES 


linens at less cost than the power-loom products can be bought for 
now at home or abroad. The French Canadian farmers are pro¬ 
ducing some very fine hand-loom fabrics today at less than factory 
prices. 

For downright durability the cassimeres and jeans, the table 
linen, coverlets, and “ butternut ” of this home-weaving period 
have never been equaled. However, as the new country gradu¬ 
ally increased in population, farming, along with other classes of 
business, began to assume a more specific and limited form. With 
the building of towns, the settler found the sawing of his trees into 
lumber and the clearing away of his forests for the greater produc¬ 
tion of stock and grain a profitable employment. His time has 
become limited in which to prepare the yarns for his weavers. 
It was tedious and toilsome work to prepare the linen, with always 
more or less delay and uncertainty connected with harvesting, 
retting, heckling, and spinning of the flax. Much time was also 
consumed in the shearing, washing, carding, and spinning which 
were necessary in preparing the woolen yarn. The entering wedge 
to the breaking up and final abandonment of home weaving was 
the establishing of carding mills in country neighborhoods. These 
mills would take the farmer’s wool and, with improved machinery, 
card it for him while he waited. Today the handmade textiles are 
luxuries, prized for their beauty and durability far above the less 
expensive machine product. 

QUESTIONS 

1. Through what stages has industry developed? 

2. Why are women credited with inventing the original textile 
processes ? 

3. Briefly describe the steps through which thread spinning has 
probably evolved. 

4. How did the primitive weaver weave his cloth ? 

5. In what way does the Navajo Indian weave his beautiful blanket? 

6. What are the principal colors found in Navajo blankets, and what 
do they represent ? 

7. Where did the Hebrews learn the art of producing fine linen? 

8. What was the Roman attitude toward linen? 

9 . Where did sericulture originate ? 


DEVELOPMENT OF PRODUCTION OF TEXTILES 201 

10. Briefly describe life on a feudal manor. 

11. How were shoes made by hand ? 

12. Explain the operation of the one-thread spinning wheel. 

13 . Compare the flax wheel and the wool wheel. 

14 . What is meant by bartering? 

15 . What are guilds? 

16 . Trace the origin of guilds in the textile field. 

17 . Compare craft guilds and trade unions. 

18 . How does the domestic system differ from the guild system? 

19 . What would be the position of the cotton industry today if some 
easy way of separating seed and fiber had never been invented ? 

20. What fiber was largely displaced by improvements in cotton 
manufacture ? 

21. Explain the operation of Arkwright’s frame. 

22. Describe the characteristics of a roller-drawn thread. 

23 . How does a “woolen” thread differ from a roller-drawn thread? 

24 . What sources have furnished motive power for textile appliances? 

25 . What effect did the development of the factory system have upon 
governmental control of industry ? 

26 . In vertical columns list the advantages and disadvantages of the 
factory system as compared with the domestic system of production. 

27 . By what agencies does the government attempt to control the 
abuses of the factory system? 

28 . For what is Samuel Slater noted? 

29 . Compare the German and American method of shoe manufacture. 

30 . At one time linen was more popular than cotton. What factors 
are responsible for the increased use of cotton ? 

31 . What textile products are still made by hand? 

32 . In the case of these products what advantages has hand production 
over the machine ? 


CHAPTER VI 


BUSINESS ORGANIZATION 

Textile and Other Industries 

Importance. A knowledge of the history and development of 
the textile industry makes possible a better understanding of pro¬ 
duction and marketing. The clothing and textile industries have 
developed rapidly from their beginnings in private homes as part- 
time occupations to their present importance as large-scale enter¬ 
prises constituting one of the most important branches of American 
industry. 

Few people realize the magnitude and importance of the indus¬ 
tries for manufacturing wearing apparel. Since cloth is the prin¬ 
cipal item in clothing, it may be well to consider this one item by 
itself — number of people employed, etc. The textile industry 
alone gives employment to over 1,000,000 persons, paying them 
more than $500,000,000 annually in wages and salaries ; producing 
nearly $1,750,000,000 in gross value of product, and giving a live¬ 
lihood to at least 3,000,000 of our population. 

According to the recent census of the United States it is esti¬ 
mated that the manufactured value of America’s clothes runs close 
to $5,000,000,000. But that is by no means what the ordinary 
purchaser has to pay out himself. From the factory to the jobber, 
to the retail seller, plus transportation and profits — the cost of 
these clothes mounts so rapidly in reaching the consumer that the 
inhabitants of the United States, 130,000,000 in number, expend 
at least $15,000,000,000 a year for clothing. At this rate, the 
average man, woman, and child will spend $120 a year on wearing 
apparel. 

The “ spread ” between the manufactured value and the retail 
price of clothes can be illustrated by the following: According 
to census compilations the average manufactured value of women’s 
stockings is 39 cents and men’s socks 22 cents. Divide the average 

202 


BUSINESS ORGANIZATION 


203 


into the retail price you pay and you will know the difference 
in percentage between value and cost. 

With regard to hosiery, in one year 1,168,195,024 pairs of stock¬ 
ings and socks were manufactured at a value of $379,000,000. 
In other words, everybody in the country wore out, on the average, 
10 pairs of stockings or socks in 12 months. Of these 453,810,456 
were men’s and 714,384,568 were women’s. Note that because 
hosiery is a more important item in the dress of women than 
of men that women wear out theirs twice as fast as men. More 
than half of the women’s stockings made pretensions at being silk 
— 251,000,000 pairs with some silk in them. However, in a year only 
36,000,000 pairs of real silk stockings are manufactured for women. 
Only five per cent of women wear real silk stockings, but only four 
per cent of the men sport real silk at their ankles. Out of 118,- 
000,000 so-called silk socks, only 18,000,000 are the genuine article. 

During the year 351,144,000 pairs of shoes were manufactured 
at a total manufacturer’s value of $950,479,000. Thus the average 
value per pair of shoes in the United States was $2.72. The dif¬ 
ference between this sum and what you pay at retail represents 
the cost of marketing, etc. If these shoes were evenly divided 
throughout the country, your quota would be three pairs annually. 
If you bought more than that somebody else must have done with 
fewer pairs. There were manufactured 100,282,892 men’s leather 
shoes, and 109,676,409 women’s leather shoes. The girls had 
8,345,705 fancy dress slippers of satin or silk. The sport people 
used 6,433,693 in golf and tennis. 

Men’s clothes have a manufactured value of $1,179,000,000, and 
women’s $1,407,000,000 during a year. The largest item for the 
men, of course, is suits, on which they spent $560,000,000. Their 
overcoats have a value at the factory of $192,000,000. Workmen 
in denim require clothes manufactured at a cost of $94,000,000. 
Boys’ clothing costs barely less than $90,000,000. 

Women’s clothing runs higher. Their largest expenditure, 
according to the census figures, is for dresses, shirt waists, and 
blouses — $634,000,000. Their suits, skirts, and coats represent 
a value at the factory of $518,000,000. As for their underclothes, 
the silk or semi-silk kind, together with such things as corsets 
and petticoats, amount to $115,000,000. Heavy knit underwear, 


204 ECONOMICS OF CLOTHING AND TEXTILES 


however, is still very popular, some $469,000,000 of it being made 
for men and women during a year. 

Then, of course, there are cosmetics — $150,000,000. In addi¬ 
tion, over $150,000,000 is spent for dress accessories, not con¬ 
sidering the very large amount spent for jewelry. 

The Business Man — Entrepreneur. We found in Chapter I 
that the various factors contributing to production may be classi¬ 
fied as (a) land, ( b ) capital, (c) labor, and ( d ) management. 
Thus, when we consider successful textile manufacturers we see 
that their production of cloth is due to these four factors : (a) land 
— a place to do the work, such as a business establishment housed 
in a building located on the land; (6) labor, possessing the neces¬ 
sary skill to work the raw materials into finished products; (c) cap¬ 
ital, or machines and money to pay wages, purchase supplies, and 
finance the business until the finished textiles are sold and the 
payment received; and ( d ) intelligent management, supervisors 
and executives to organize and control the business of production. 
Raw materials, machines, land, buildings, and labor will not produce 
commodities unaided. They must be coordinated, organized, and 
supervised. Some one must take the initiative in planning, 
making decisions, and accepting the risks and responsibilities 
of the enterprise. The one who undertakes this task is called the 
entrepreneur or business man. 

Thus a shoe manufacturer must decide on the kind, quality, and 
number of shoes he is to produce. He must advertise to create 
a demand or else have a ready market for his product. He has 
had to organize his shoe factory, securing site, capital, building, 
equipment, raw materials, employees, etc. 

Whether the entrepreneur or management element in a business 
consists of one person or many persons depends largely upon the 
type of organization followed and frequently upon the size of the 
enterprise. Business organizations are usually classified into four 
groups: (1) individual business man, (2) partnerships, (3) cor¬ 
porations, and (4) cooperative organizations. 

Types of Organization. If we study the different companies or 
business men engaged in the production of wearing apparel, we 
shall find, as in other lines, all forms of business organization, each 
with distinct advantages and disadvantages. 


BUSINESS ORGANIZATION 


205 


(1) The single business man, such as a proprietor of a haber¬ 
dashery or a dress shop, a farmer who raises cotton, a proprietor 
of a millinery store, etc.; (2) partnerships — a combination of 
two or more proprietors, such as exists in a garment factory where 
one partner may be the head designer, looking after the manu¬ 
facturing, while the other is looking after the marketing of the 
garments; (3) a corporation, composed of three or more individ¬ 
uals with a charter from the State, such as a large mill or a company 
like the American Woolen Co.; (4) a cooperative business organ¬ 
ization, such as the Wool Growers’ Cooperative Association, where 
the wool growers cooperate in selling the wool through their own 
organization in order to secure the additional income that would 
go to the middleman business firms. 

Single Business Man. The first type of organization, in which 
the entrepreneur is a single business man, may be illustrated by 
a farm, sheep ranch, cotton plantation, or the merchant tailor. 
Most of the raw material used in the manufacture of textiles is 
obtained from the farm: (a) cotton, (b) wool from the back of 
sheep that graze on farm land, (c) linen, (d) silk from the silk¬ 
worm that feeds on the fresh mulberry leaves. Even spruce wood 
and cotton-seed furnish fibers that are the raw materials for 
synthetic fabrics, as rayon. All these come from the farmland. 
So some of the problems of the farm, usually called agricultural 
problems, are more or less the problems of textiles and clothing as 
well. 

The farmer today who devotes his life to the raising of the raw 
materials for clothing has not been able to prosper because of the 
low prices of his products and the high prices of the commodities 
he is obliged to buy for his farm. The farm products, particularly 
cotton and wheat, which are exported, must compete with the 
world’s market in cotton and wheat. The tariff, on the other hand, 
protects the manufacturer of domestic commodities. The home 
market, which is high, determines the price the farmer pays for 
his commodities, while the world market, which is low, determines 
the price at which he must sell his wheat or cotton. Farmers 
naturally feel that since the industries of the country have been 
assisted by the government by tariffs, etc., the government in 
turn should assist them. 


206 ECONOMICS OF CLOTHING AND TEXTILES 


The farmer was very prosperous during the World War because 
of the demand for foodstuffs. During this time he procured more 
land and better machinery at the high (inflated) war prices. After 
the war, prices dropped one-half, and the demand for cotton and 
foodstuffs decreased. Hence he was frequently unable to continue 
the payments on the mortgage on the land and the payments on 
the new equipment. 

The farmer is handicapped in many ways, more so than the 
manufacturer of the industrial group. He is unable to determine 
in advance the exact size of crops of cotton, etc., because of condi¬ 
tions over which he has no control, such as heat and cold, drouth 
and insect pests. Furthermore the farmer is rather conservative 
and is not quick to respond to new ideas — curtailment of land 
planting, use of automatic machinery, new devices for eliminating 
pests, utilization of waste products, etc. 

In addition he requires much credit — short-term notes (nine 
months) for the raising of the crops, three-year loans for the raising 
of sheep, and long-term notes for the purchase of machinery and 
land. The government has assisted the farmers by encouraging 
banking institutions to loan money to them for longer periods 
(nine months) than the 90-day loans granted to industries. 

Some raw materials, such as cotton, must be sold in the fall 
because the farmer needs the amount of capital he has paid out 
or borrowed during the year. He may have to sell at auction. 
This is not so with wool. He can obtain part or whole of the 
capital invested in the wool by selling his lambs for mutton and 
placing the wool in storage until the price is higher. 

The single business man is usually limited to a small undertaking, 
such as the cotton or sheep farms described, the retail dry-goods 
store or haberdashery, or a small jewelry store, etc., where the 
capital is small, the risks small, and it is possible for one man to 
handle the problems of the business. Let us consider, for example, 
a tailoring establishment conducted by one man. The owner may 
or may not do all the work. He may be only the designer, and 
employ others for salesmen, cutters, repair men, etc. But however 
the business is conducted, he must assume all the risks and respon¬ 
sibilities. If there are profits, he receives them, but if there are 
losses, he is responsible for them. In case of failure he is held 


BUSINESS ORGANIZATION 


207 


personally responsible for all the debts. The legal existence of the 
business terminates with his death. Of course he has the satisfac¬ 
tion of conducting his business in the way he desires, and has a 
personal relation with his customers and his employees. While the 
capital invested is usually small and the return correspondingly 
small, the sense of personal achievement and a love for craftsman¬ 
ship or for his work bring much pleasure to the independent 
entrepreneur. 

The Partnership. The partnership was a popular form^bf 
organization a generation or more ago, but the corporation has 
now largely supplanted it in favor. The partnership organization 
usually increased the amount of available capital and divided both 
the duties and responsibilities of the entrepreneurs. A partnership 
is formed legally through a written agreement among the members 
specifying the various duties, financial responsibilities, and the 
division of profits among the members. The partnership has the 
advantages that it can be easily established, easily dissolved, and 
easily changed with respect to the relationship among the various 
members. It has the disadvantages that its legal existence termi¬ 
nates with the death of any partner and that each partner is legally 
liable for all debts of the partnership, even in excess of his invest¬ 
ment. 

The Corporation. Most business enterprises of any magnitude 
are organized in the form of a corporation. It often happens that 
one man or a group of men desire to establish a mill or large factory 
that requires more money than they alone are able or willing to 
invest in it. They obtain more money by organizing a stock 
company, in which they themselves buy as many shares as they 
choose, and then they induce others to pay for enough more shares 
to make up the capital that is needed or authorized for the business. 
A stock company consists of three or more persons, organized under 
a general law or by special charter from one of the States, and em¬ 
powered to transact business as a single individual. A corporation 
like the American Woolen Company, or other textile organization, 
is established to engage in business with capital derived from the 
sale of stock that is transferable and may be bought and sold. 
The profits are distributed to the stockholders as dividends in pro¬ 
portion to their holdings of stock. The majority of stockholders 


ECONOMICS OF CLOTHING AND TEXTILES 


Cotton Mills 


New Bedford Stocks 

Associated Textile.. 

Bid 

Asked 

8 

do 6% preferred. 


9 

Beacon Mfg. common. 

. 90 


do preferred. 


64 

Booth Mfg. common. 

. 2 

3 

do preferred. 

. 10 


* City Mfg. Co. 

. 2 

i 

Dartmouth Mfg. Co. 

. 9 

10 

do preferred. 

. 72 


Gassold Mill preferred. 

. 27 

29 

General Cotton Co. 

3 

T 

1 

Gosnold Mill preferred. 

. 6 

7 

* Grinnell Mfg. Co. 

. 5 


Hathaway Mfg. Co. 

. 24 

25 

Holmes Mfg. Co. pfd. 

• 2i 

5 

Kilburn Mill. 

. 12 


Nashawena Mills. 

• 4 

5 

Neild Mill. 

. 9 

10 

Nonquit Mill. 

• 4 


Pierce Mill. 

. 31 

34 

Potomska Mill. 

. 18 

19 

Quissett Mill. 

. 16 

18 

Soule Mill. 

. 26 

28 

Taber Mill. 


3 

Wamsutta Mills. 

• 3f 

4 

Miscellaneous 

Berkshire Spinning, common. 

. 1 

4 

do preferred. 

. 6 

Dexdale Hosiery Co. 


75 

do preferred. 

. 65 

671 

Gosnold Mill notes. 

. 77 


Pepperell Mfg. Co. 

. 27 

29 

Fall River Stocks 

Algonquin Printing Co. 

.140 

155 

Barnard Mills. 

. 4 

6 

Border City Mfg. Co. 

. 1 

2 

Bourne Mills. 

. 9 

10 

Charlton Mills. 

. 30 

33 

* Cornell Mills. 

. 1 


Davol Mills. 

V 

4 

Luther Mfg. Co. 

. 50 

55 

* Merchants Mill. 

. 6 

7 

Narragansett Mills. 

. 1 

2 

Pilgrim Mills common. 

. 20 

25 

Sagamore Mfg. Co.. ... 

. 19 

20 

Stevens Mfg. Co. 

• 4 

10 

* Union Cotton Mills. 

. 1 

3 

* In liquidation. 

Bid refers to the price that one 1 can sell at and asked refers 

to the price desired. Note that some of the stocks are above 

par ($100), and others are below. The low quotations are for 

the marginal producers. 


















































BUSINESS ORGANIZATION 


209 


act in meeting and control the actions of the corporation. They 
are liable only to the amount of money they have invested for 
stock in the corporation. 

Stock companies often issue two kinds of stock, namely: pre¬ 
ferred stock, which consists of a certain number of shares on which 
dividends are paid at a fixed rate, and common stock, which consists 
of the remaining shares, among which are apportioned whatever 
profits there are remaining after payment of the required dividends 
on the preferred stock. Stocks are generally bought and sold by 
brokers, who act as agents for the owners of the stock. Brokers 
receive as their compensation a certain per cent of the selling price 
of the stock bought or sold. This is called brokerage. 

The capital stock of a company is the amount named in its 
charter. A share is one of the equal parts into which the capital 
stock of a company is divided (frequently $100). The par value 
of a share of stock is its original or face value. Stocks are some¬ 
times issued with no-par value, in which case a nominal value is 
set, based upon the total capitalization and the number of shares 
issued. The market value of a share of stock is the price for which 
the share will sell in the market. The market values of leading 
stocks vary from day to day, and are quoted in the daily papers. 
The quotations on page 208 show the effect of the depression on 
textile stocks. 

The corporation is managed by a board of directors elected by 
the stockholders. They are agents of the stockholders and must 
conduct the business as carefully as their own; in some cases they 
may be held liable both criminally and civilly. A majority of the 
board members in assembly have power to act, although they may 
delegate certain powers to an agent — as the agent of a mill. The 
chief officers of the corporation are the president, secretary, and 
treasurer. Sometimes in large corporations this number is in¬ 
creased by vice-presidents, auditors, counsel, etc. 

Corporations secure their capital through sales of stocks and 
bonds. A stockholder is a part owner of a corporation and has a 
voice in organization, but a bondholder is only a creditor — he 
receives his interest but has no voice in management. However, 
some bonds provide that in certain emergencies, as failure to pay 
interest when due, bondholders may have voting power. A bond 


210 ECONOMICS OF CLOTHING AND TEXTILES 


is a statement of promise to pay a sum of money at a definite rate 
of interest at a certain time. It is secured by a mortgage upon 
the property of the corporation. 

When property has already been mortgaged and a further bor¬ 
rowing is necessary, a debenture bond may be issued. Such a 
bond is not supported by tangible property with clear title. De¬ 
benture bonds are usually issued only as an extreme measure and 
only by the very strongest concerns. 

When a corporation is unable to pay its bills, or meet its obliga¬ 
tions in cash, it is said to be insolvent. This condition may be due 
to lack of capital, poor management, fraud, or neglect, etc. Such 
a condition means bankruptcy or the appointment of a receiver by 
the courts. 

A business firm may under the above conditions petition the 
courts to adjudge them bankrupt in order to discharge them from 
their obligations, upon an agreement to pay their creditors a per¬ 
centage of their debts. In this case they may begin business over 
again. If the creditors are not satisfied, they may ask the court 
to declare the organization bankrupt, close the business, and 
distribute the assets among the creditors. 

Corporations such as large wearing apparel factories, mills, shoe 
factories, etc., often need to borrow money in order to meet ex¬ 
traordinary expenditures. When a corporation wishes to borrow 
a large sum of money for several years, it usually mortgages its 
property to a person or bank called a trustee. The amount of the 
mortgage is divided into parts called bonds, and these are sold to 
investors. The interest on the .bonds is at a fixed rate and is 
generally payable semi-annually. Shares of stock represent the 
property of a corporation, while bonds represent debts of the 
corporation; stockholders are owners of the property of the cor¬ 
poration, while bondholders are its creditors. 

Well-secured bonds are safer than stocks, as the interest on the 
bonds must be paid regardless of the condition of the business. 

One can readily see why the corporation type of business is 
popular and has been a strong factor in business development dur¬ 
ing the last generation. The stockholders delegate their control 
to the officers they elect. If a stockholder dies, his share or shares 
are transferred, without any interruption to the organization. 


BUSINESS ORGANIZATION 


211 


Also, shares may be bought and sold in any number without 
changing the organization of the corporation. 

The credit or borrowing capacity of a corporation is limited to 
the capital of the business. The credit of a partnership may be 
equal to the entire wealth of the partners of the firm. 

Cooperative Organizations. In certain branches of industry, 
particularly among farmers, cooperative organizations have been 
formed. Members of such organizations have united to carry 
on some phase of marketing or other function for their common 
benefit. Under free competition it is rather difficult to con¬ 
trol the supply of a commodity; for example, the amount of raw 
cotton in 1931. Because of the large number of farmers who 
plant cotton, all working more or less by themselves, and despite the 
government reports and the experience of the over-production in 
1930, the production of 1931 again went above the demand. If 
cotton were under the control of a monopoly, it would be possible to 
regulate the supply so as not to exceed the demand and at a price 
that would give the farmers a fair profit. The government has 
encouraged the forming of cooperative associations among the 
farmers for the purpose of regulating the production and marketing 
of wool, cotton, etc. Such an association assists the farmers in 
regulating the supply and also stores the product until the prices 
are high. The cooperative associations are also able to secure 
better transportation rates. The government has created a Federal 
Farm Board to assist the farmers by loaning to the cooperative 
associations, securing better transportation rates, etc. 

In addition, the cooperative associations have encouraged large- 
scale production, reduction of property taxes, use of labor-saving 
machinery, utilization of by-products, and stabilization of the 
price of cotton. 

Land and Labor. Land and labor are spoken of as primary 
factors of production, while the business man and capital goods are 
derivatives of the other two and are called secondary. To illus¬ 
trate : If labor is applied to the ground, cotton, a raw material for 
clothing, may be raised or produced. While the raw cotton raised 
will not directly satisfy the human want of clothing, it will 
do so after it is carded, spun, woven, and finished into a 
garment. 


212 ECONOMICS OF CLOTHING AND TEXTILES 


The cotton in different stages of development of manufacture into 
a costume forms intermediate products for additional production, 
which are called capital goods. The finished cotton dress is called 
consumers’ goods. 

Even in manufacturing, the land is an essential factor of produc¬ 
tion. For instance, a woolen mill is usually built on the banks of 
a river so that the dirty-colored solutions, the dyes liquor, and the 
wool-washing grease may be poured into the water and carried 
away. • The location is unattractive, the mill itself with its smoking 
chimneys and heavy machinery is unattractive, but both are 
necessary for the production of worsted suiting from raw wool. 
They are called capital goods and are indirectly related to human 
wants because they contribute to the production of the finished 
commodity. 

Industrial Centers. Previous to the development of the factory 
system there was no reason why any industry should be centered 
in one particular district. Upon utilization of steam power, the 
textile industry became subdivided into a number of industries, 
each one becoming to a great extent localized in convenient and 
suitable portions of the country. Thus in Bradford, the wool of 
Yorkshire (England) meets the coal of Yorkshire, and makes 
Bradford the great woolen and worsted center of the world. A 
similar thing took place in Manchester, where the cotton of America 
meets the coal of England under satisfactory climatic conditions, 
thus around Manchester is the greatest cotton manufacturing 
center of the world. 

The same is true in America. Lawrence became a large worsted 
center on account of the great water power and the use of the river 
to deposit wool washings. Lowell and Fall River became large 
cotton centers due to water power. Haverhill became the center 
for the manufacture of women’s slippers because of an early start 
and a supply of skilled labor. New Bedford became the center of 
fine cotton goods due to the climatic conditions — moist atmos¬ 
phere, which is necessary in spinning fine cotton. 

Similarly, Brockton is the center of manufacture of men’s shoes; 
Providence and Attleboro are centers of jewelry supply because of 
a supply of trained labor and the low cost of living; Boston is the 
greatest wool market because of superior financial arrangements 


BUSINESS ORGANIZATION 


213 


with banks. Columbus, Georgia, has become a cotton center be¬ 
cause of the nearness of the raw material, although developed 
later than northern cotton manufacturing centers. 

Southern factories possess the advantage of nearness to the cotton 
fields and a climate whose mildness insures them against those inter¬ 
ruptions which in severe winters are often causes of inconvenience 
and loss to northern mills. Other advantages over the North are 
cheaper land, and cheaper building material, fuel, and labor. 

Shifting Centers. A similar grouping of industrial activities into 
special centers can be noticed in individual cities. The location of 
these centers may shift as the city grows and develops. Thus in 
New York, the silk industry, which, five years ago, appeared to be 
anchored around Thirty-fourth street and Madison avenue, is now 
conducted in large part from the district surrounding Fortieth street 
and Seventh avenue near the garment center. Cotton merchants, 
who started to move uptown several years ago, have centralized 
in the well-known cotton district of Leonard and Worth streets. 
The woolen district, though remaining close to Fourth avenue 
during the past decade, has changed somewhat in the last five 
years. Recently the drapery trades have shifted from their former 
totally different centers to a center above Thirty-fourth street and 
Park avenue. 

Capital Goods. The labor of many may be increased by the use 
of tools. The following quotation illustrates the power of man 
with tools : 

Man is weak of himself and of small stature. He stands on a basis, 
at most for the flattest soled of half a square foot insecurely enough, never¬ 
theless he can use tools, can devise tools. With these the granite moun¬ 
tains melt into light dust before him; he kneads glowing iron as if it were 
soft paste; seas are his smooth highways; wind and fire his unwearying 
steeds. Nowhere do you find him without tools; without tools he is 
nothing; with tools he is all. — Thomas Carlyle. 

These tools represent part of his capital. They have value be¬ 
cause of their use in aiding man to utilize his physical powers and 
senses to greatest advantage. These tools enable him to produce 
more wealth. Tools and machinery are capital goods, and while 
they do not directly satisfy any human wants they do assist us in 
the production of wealth that does satisfy our wants. 


214 ECONOMICS OF CLOTHING AND TEXTILES 


If we study the production of a commodity such as woolen cloth 
from the household system td the factory, we note that years ago 
the wool was raised on the farm, washed, carded, spun, and finished 
in the house of the farm. Today the wool is raised on the western 
ranches, sent east by railroad to storehouses, then to the woolen 
mills in Philadelphia, or other parts of the country. The ma¬ 
chinery in the woolen mill may be made in Massachusetts and sent 
to Philadelphia. Thus we see that today under the factory system 
there is a more or less round-about method of production requiring 
much capital. The work in a large mill is highly specialized and the 
production great in various patterns. The woolen cloth and other 
commodities are produced in response to demand. The operatives 
work less hours and receive more pay, and the goods are cheaper 
under the factory or mill system. 

Capital goods is divided into three classes: (1) the industrial 
plant with machinery, — i.e., a cotton mill with the carding, 
spinning, and weaving machinery; (2) raw materials raw 

cotton, raw wool, raw silk, such materials as come from the cotton 
plant, and animals such as silk worms; (3) food stuffs. 

When cotton is harvested by the farmer, it is not ready for con¬ 
sumption and is not a consumable good. To the cotton manufac¬ 
ture it is a capital good, and he spins and weaves and finishes it into 
a sheeting, which is sold to the retail store as a capital good. The 
retail store sells it to the consumer, who takes it to his home, 
where it is actually used. The sheeting does not cease to be capital 
until it has been put to use by the consumer. 

It is also possible to consider it as capital goods even when it is 
being used by the consumer. Thus, if the consumer is a worker, 
the sheeting assists him in obtaining a comfortable night’s sleep, 
so as to allow him to regain his strength for the next day’s work. 
Therefore the sheeting is consumed with a productive end in view 
and may be classed as capital. On the other hand, if the man who 
uses the sheeting is inactive and not performing useful services to 
society, the sheeting can not be classed as capital goods. In one 
case the consumption of the sheeting leads to an increase in pro¬ 
duction, while in the other case it does not. 

Fixed capital is a term applied to capital goods such as cotton 
machinery, spinning machinery, and sewing machines, which can 


BUSINESS ORGANIZATION 


215 


be used repeatedly in the same operation. Cotton is capital goods 
that can be used only once, and is called circulating capital. 

The machinery or equipment of a mill wears out in about ten 
years, more or less. The factory or mill buildings will last longer — 
fifty or seventy-five years. In order to make allowances for this 
wearing out, a certain amount, 10 per cent of the value of the 
equipment and a smaller per cent of the value of the buildings, is 
laid aside each year and is called a depreciation or replacement 
fund. 

Capital Funds. In all types of business organization one must 
secure capital to pay rent or purchase a building and machinery 
and to pay the workers long before he receives money from the 
sales of his finished product. The capital for the plant or factory is 
obtained from the sale of stock and bonds. The success of the 
manufacturing or production depends upon: (1) skill of the 
workers, (2) ability of the managers in directing the workers, 
(3) up-to-date efficient equipment, (4) manufacturing a product 
that has a market or is in great demand. The capital necessary to 
buy raw material, pay the workers, and provide the money neces¬ 
sary to run the plant until the sale of the product, is usually ob¬ 
tained from bankers on notes. 

The capital fund depends in general upon the productiveness of 
the people, their thrift, and willingness to save. Savings of a man, 
regardless of his station in life, take final form in money or credit 
which he puts into some business or bank. Thus the loanable 
capital fund of a community or a country represents the savings of 
the people who wish to allow other people the use of their capital. 

Capital in any country can be secured if (1) opportunities exist 
for the profitable employment of money, (2) there is an adequate 
supply of properly trained laborers who are willing to work at 
reasonable wages, (3) there exist good business men or entrepre¬ 
neurs ready and willing to engage in business and willing to assume 
risks, etc. 

The South a generation ago offered opportunity for capital in 
cotton manufacturing because it was near the source of raw mate¬ 
rial, possessed a plentiful supply of laborers from the mountains 
who were willing to work at reasonable wages and were capable 
of being trained quickly, and had a group of successful business 


216 ECONOMICS OF CLOTHING AND TEXTILES 


men, many of whom had been trained in college-grade textile 
schools. 

Some capital yields a large return, while other gives a small return. 
That part of capital which yields a small return — just sufficient 
to compensate its owner — is called the marginal unit of capital 
and of course is the least productive part of the country’s capital. 

Since capital tends to seek enterprises that give the highest 
return, and since competition is keen, it is only natural that the 
marginal supply of capital shifts from one industry to another, and 
the net returns tend toward a common rate of interest. 

The textile and clothing industries are uncertain in their income 
because they depend in many cases on whims and fancies of the 
people — styles and fashions — and are seasonal in character. 
Therefore the greatest return on capital invested in these industries 
is obtained by men and women who have natural ability for this 
type of business, initiative, inventive ability along mechanical 
lines, and artistic ability as applied to wearing apparel. 

A cotton merchant may borrow money from the bank on his note 
and have this money deposited to his name in the bank. Because 
he has this money in the bank, people have faith and confidence 
that he will pay, and they allow him to secure a larger stock of 
cotton goods on his standing — credit. The mill owner is able to 
borrow money from the bank on a note or mortgage, and with 
this money he is able to enlarge his plant, buy cotton when it is 
cheap and place it in storage until required, and increase the output 
of finished cloth. 

Certain banking institutions like the International Acceptance 
Bank are able (a) to finance shipments to and from all parts of the 
world, (6) supply credit information about foreign merchants, 
(c) purchase foreign currency drafts, and (d) provide confidential 
information about financial standing and credit. 

The principal factors of production: (a) capital, ( b ) labor, 
(c) business man, etc., can not be supplied at a moment’s notice. 
While there is always much capital ready to be used for promising 
industries, we must remember that the existing trades have first 
claim on this capital because they have the experience and the 
credit that will appeal to those with capital. They can increase 
their plants and thus keep out, more or less, the newcomers. 


BUSINESS ORGANIZATION 


217 


Labor is not always plentiful and properly trained. The business 
man who will be the leader must also have experience, technical 
training, etc., which can not be developed at a moment’s notice. 
All men are at liberty to enter any branch of the clothing or wearing 
apparel trades, but not all are properly equipped to be successful 
in the industry. 

Duties of the Entrepreneur. With the increase of population 
came the development of cities and the desire to buy wearing 
apparel already made. The textile mills and factories began the 
practice of making wearing apparel for sale in advance of orders. 

This naturally led to a demand for business men who could deter¬ 
mine the kinds of wearing apparel required and the necessary quan¬ 
tity, and who had the ability to sell the wearing apparel when it 
was made. In other words, there arose a strong demand for com¬ 
petent people who could buy and sell as distinct from those who 
manufactured or made the wearing apparel. Trading or buying 
and selling will be considered in the following chapter. 

The history of the manufacture of clothing shows that prosperity 
can be increased greatly (1) by selecting and producing the right 
kind of raw materials, (2) by manufacturing these more efficiently 
into finished fabrics and costumes, and (3) by more economical 
marketing. 

The business man or captain of industry (a) engages and dis¬ 
charges the labor, which is the most important and expensive 
item in production; (6) he selects, secures, and assembles the 
plant or mill, that is, the buildings, machinery, and raw materials; 

(c) he selects the site for the mill either by leasing or buying; 

( d ) he must secure permission from the community to do business 

by paying necessary taxes, securing the charter or license, and 
meeting other requirements; ( e ) he determines the business 

policies; (/) he assumes the risks and receives the profits. 

The leader or leaders of a business are responsible for its success 
and naturally require vision, good judgment, courage, and energy; 
if they fail or blunder, the business will fail. If the ability is 
centered in one person, he is called the business manager, the enter¬ 
priser or entrepreneur. The compensation of the business manager 
or entrepreneur may be small or it may be great. He may even 
suffer a loss; it all depends upon the amount he receives for his 


218 ECONOMICS OF CLOTHING AND TEXTILES 


product above the cost. Of course in many lines of business, the 
manager assigns himself a definite salary such as he would receive 
from some one else, and then considers as profit what remains of 
the earnings above costs. 

Cost of Production. We saw earlier that the price of any com¬ 
modity tends to equal the cost of production plus a fair return or 
profit to the entrepreneur, presumably equal at least to his earning 
power were he employed by some one else. Thus the price of 
cotton cloth is expected to be sufficient to pay for the raw material, 
the wages of labor, interest and taxes, running expenses of the mill, 
and leave a fair profit to the manufacturer. 

In production or in merchandising the maximum return depends 
upon the most effective concentration of the available production 
factors: (a) capital goods, ( b ) land, (c) labor, and (d) organiza¬ 
tion. We saw in an earlier chapter that in the cultivation of land, 
there is always a point reached when the application of additional 
labor and capital to a given area fails to cause a proportional in¬ 
crease in the yield. This law of diminishing returns can be applied 
to any factor of production. Thus in any given factory, there is 
a maximum point of efficiency reached beyond which it is not 
profitable to increase the amount of capital or labor invested. 
At that point the unit cost of production has been reduced to its 
lowest terms. 

The cost of production in any particular factory is largely de¬ 
pendent upon the skill of the entrepreneur and his judgment in 
securing the most economical combination of the various factors of 
production. Thus if labor is cheap in a given locality and ma¬ 
chinery expensive, it is more economical to increase the amount 
of labor. In another locality where labor is scarce, it might be 
more economical to increase the number of machines used. 

The cost of producing textiles, wearing apparel, and services 
varies with different localities and different mills and factories. 
Some localities, like the South, may be nearer the source of raw 
material, labor may be cheaper, or a waterfall near may give low 
power cost. Then again, in the same locality, one mill may have 
more up-to-date machinery and better power transmission that 
gives maximum power at minimum cost. In the same locality, 
the cost of raw material and labor would be fairly constant, and 


BUSINESS ORGANIZATION 219 

the difference in the efficiency of the power department or machin¬ 
ery would cause the difference in cost on the same material. 

Some mills and factories are better organized as to the purchase 
of raw material and the manufacturer’s operations than others. 
Thus one gingham mill may be able to manufacture a gingham at 
a cost twenty per cent lower than another mill. The cost of pro¬ 
ducing a commodity, such as a yard of worsted cloth, varies. If 
the plant is running full force, then the cost of a yard of 
worsted will be at a minimum. On the other hand, if only 
part of the departments are running full force, then the cost 
of the same worsted fabric must be higher to cover the over¬ 
head expense. 

The market value of the cloth or wearing apparel tends to 
approach the cost of manufacturing at the greatest disadvantage, 
hence the mills or factories that have the highest costs are called 
marginal producers, because they are on the margin of the produc¬ 
tion and are more important in determining the market prices 
than any of the others. Of course it is assumed in the above 
explanation that there is free competition among all. 

The textile and wearing apparel industries, as well as other 
branches of manufacture, are filled with marginal producers. 
While they may exist in prosperous times because there is a demand 
for their products, nevertheless as soon as the demand falls and 
the price goes down, they are not willing to sell and, if they do, 
they sell at a loss. These producers are on the edge of failure, 
and from this class are recruited the large number of failures and 
bankruptcies in times of depression. 

Bankruptcy losses during the ten years 1921-31 increased 
from $171,000,000 to over a billion dollars, and most of the in¬ 
crease was in the wearing apparel industries. The people to whom 
this money was owed, called creditors, have received about 5.1 per 
cent of the amount owed them. 

Many mills and manufacturers of clothing and wearing apparel 
have large plants with large investments in fixed capital goods. 
In times of depression these mills and corporations may find it 
advisable to close out their investment, since holding the goods 
may mean that they will be out of style shortly, and thus cause the 
owner greater loss than by selling immediately. 


220 ECONOMICS OF CLOTHING AND TEXTILES 


Demand and Supply. Intelligent control of production in 
accordance with statistics gathered by the trade itself should point 
the way for textile men to control output and prices to the extent 
of not losing money on sales. This information should be col¬ 
lected by the trade organization, composed of the manufacturers 
of that branch of the industry, like the Silk Association of America, 
etc. In addition, every branch of the textile and wearing apparel 
industry has a trade paper that collects much valuable informa¬ 
tion and statistics with regard to the conditions of the trade. 

The mill man, the dress manufacturer, and other manufacturers 
of wearing apparel, knowing the desires or wants of the consumers, 
are constantly manufacturing new things to satisfy these wants 
and exact only a price that will give a fair reward for their labor. 

If the price received from the consumer is not sufficient to provide 
this reward, then there will be fewer producers and less production. 
This in turn will create a scarcity of wearing apparel and the con¬ 
sumers will be obliged to pay a higher price, as competition among 
the consumers will tend to raise the price. 

When the price is raised, then more producers will enter the field 
and use their capital and energy in producing wearing apparel, 
and those already engaged will enlarge their plants so as to increase 
their output. The total production will be increased, and thus a 
larger supply will have a tendency to reduce the price. 

While it seems that the consumer would more or less control 
the price of wearing apparel by refusing to buy until the price is 
satisfactory, nevertheless the desires of human nature, partic¬ 
ularly for wearing apparel, are so intense that the consumer tends 
to satisfy these desires as long as he can afford to buy. 

Producers' Surplus. We discovered in our study of price, in 
Chapter IV, that a normal exchange value is that resulting from a 
bargaining process between the marginal consumer and the mar¬ 
ginal producer. In other words, commodities are usually ex¬ 
changed when the marginal utility of the article just equals its 
marginal cost. Such an exchange value is called a normal value. 
If wearing apparel like silk hosiery sells above its normal value, 
it is due either to a monopoly of the hosiery — special brand — 
or to the fact that an unusual change has taken place in the 
demand. 


BUSINESS ORGANIZATION 


221 


Because the market price tends to equal the cost of production 
of the marginal unit, those manufacturers operating at the lowest 
cost of production will make a far larger profit than is received by 
the marginal producers whose costs are the highest. This larger 
profit accruing to the more efficient manufacturers is called the 
producer’s surplus or differential gain. 


Joint Costs. Occasionally a factory will produce one or more 
by-products in connection with the main product. For example, 
in manufacturing silk fabrics from throwing, there is a waste that 
is used in making a spun silk fabric — that is, silk that is carded, 
spun, and woven. The spun silk is called a by-product of the mill. 
The question may be asked, “ Does the value of the thrown and 
spun silk fabrics together tend to equal the joint cost of produc¬ 
tion? ” If the demand and supply of both products is normal, then 
the joint value of them will tend to equal the joint cost of their pro¬ 
duction. If there is a greater demand for the thrown silk than 
for the spun silk, or vice versa, then the market values are deter¬ 
mined by the relative supply of the two, rather than by the cost 
of production. Because of this situation of joint costs it is some¬ 
times possible for a producer to sell one product at a slight loss 
for a time if the return from the other product is yielding a profit 
sufficient to compensate and to cause the return from the two 
products to equal the joint cost of production. 

Principles of Management and Businesslike Methods. Out 
of the experiences of the race have developed certain orderly 
methods of producing, buying, selling, and consuming clothing 
that have been found to be economical. The principles governing 
such orderly or economical methods of producing, buying, and 
selling are spoken of as principles of management, because these 
principles must be devised and carried out by a person called 
the manager-director — a person skilled in the conduct of 
business. 

The fundamental principle of management as applied particu¬ 
larly to clothing and wearing apparel is organization. Organiza¬ 
tion is the arrangement of a number of men and women (called 
workers) with appliances called machinery, properly supervised 
and managed so that all of them will cooperate and produce the 
finished or semi-finished article economically and without waste 


222 ECONOMICS OF CLOTHING AND TEXTILES 


(efficiently). Organization is the foundation stone of all business, 
especially in the textile or wearing apparel industry. 

Organization, whether in business or elsewhere, means coopera¬ 
tion — a working together for the common welfare. To bring 
together all the forces of business — employer and employees, 
machinery and capital — into a systematic relationship, is one of 
the first steps in securing the success of any business. 

Human talents consist of certain physical, mental, and social 
qualities that may be utilized in business. All types of such traits, 
from the highly developed skills to the most unskilled labor, which 
must be closely supervised, can be utilized to advantage in industry. 
The effective coordination of these varied talents into production 
is the work of a skilled manager. 

It is perhaps in the field of organization that the modern factory 
system differs most from previous methods of production. It 
may be of interest to learn the development of the mill organization 
in the United States. 

Factory Organization. The early mill managers of cotton mills 
in New England began to arrange systematically the processes 
of manufacturing so that no labor would be lost in passing from 
one process to another. Since this system was first established, 
changes have been made, but the following summary will show 
the general organization of the factory. 

The first large cotton mill was organized with a president as 
chairman of the board of directors and a treasurer as the executive 
head, who had the responsibility of buying the raw material and, 
through the selling house, of disposing of the finished product. 
The mill was separated into a number of subdivisions, such as 
carding, spinning, warp dressing, weaving, and finishing. Each 
subdivision was in charge of an overseer and his assistants. A 
superintendent supervised all overseers and had charge of the 
employees and their operations. The mechanic who had charge 
of the buildings and machinery, as well as the superintendent, 
reported to a resident agent who acted as general manager for 
the proprietors. This organization is the best method of operating 
a textile mill and selling its product. 

This method of manufacturing textiles in America was dif¬ 
ferent from that in England and European countries, where the 


BUSINESS ORGANIZATION 


223 


(a) carding and spinning and (6) weaving were done in separate 
mills. The American mill was built so as to have carding and 
spinning in addition to weaving, that is, the whole process of cloth 
making, under one roof. This method of organization was very- 
successful from the very beginning. 

Sense of Achievement. There is in every person a desire for 
achievement — the wish to accomplish something. This desire is 
satisfied in the successful accomplishment of certain acts. Thus 
the pleasure and satisfaction derived from the creative side of 
labor — the joy in craftsmanship — and the thrill of the entre¬ 
preneur in successfully overcoming competition, risks, and pro¬ 
duction obstacles, are among the real rewards of business. Money 
profit is one of the prizes of the successful business man, but it is 
not the only one. Indeed it is not the first or even the second 
prize. The first prize is, or should be, the satisfaction in rendering 
a service to the community and to society; second, the sense of 
achievement; and third, the good name or good will of the busi¬ 
ness man or firm. 

Nevertheless, the part played by profits is extremely important. 
No man will do his best work unless he receives for his own use 
the fruits of his industry. The greater the wealth to be achieved in 
an industry the more assiduously will the worker in the industry 
labor. In their early development the textile and clothing in¬ 
dustries offered great profit as an inducement. Therefore these 
industries developed very rapidly from the private homes where 
they were a part-time work to large factories where they be¬ 
came full-time occupations. The question of securing efficiency 
prompted the mill owners to experiments with various types of 
organization. 

Integration of Business Units. Shortly after the Civil War a 
movement toward greater efficiency in industry took place. It 
began by eliminating “ overhead expenses ” as far as possible, 
and by combining small units into one large unit. The large 
units required machines of greater capacity and power. 

Both “ horizontal ” and “ vertical ” combinations of units were 
carried out. The horizontal organization consisted of combining 
many cotton mills under one management. The vertical organi¬ 
zation combined the (a) raising of cotton, ( b ) ginning, (c) spin- 


224 ECONOMICS OF CLOTHING AND TEXTILES 


ning, (d) cotton weaving, and (e) cotton finishing. In other 
words it was a combination of units that would give facilities for 
the production of the finished commodity — cloth — from the 
raw material of cotton fibers. 

The combination of small units into a large unit naturally 
requires (a) a large amount of money (circulating capital) and 
machinery and equipment (fixed capital), (b) the utilization of 
one or more forms of power on a large scale to drive modern ma¬ 
chinery, (c) employment of officials and workers of different de¬ 
grees of skill and training, (d) standardization of definite com¬ 
modities, — sheetings, towels, worsted fabrics, (e) extensive and 
varied markets. 

There is a saving in overhead by combining small units because 
(a) the cost of erecting one large building equivalent in capacity 
to four units is considerably less than four times the amount 
required for a single unit; (b) each official in a large unit can super¬ 
vise and direct more workers than one-fourth of the total super¬ 
visory force of the four units; (c) special research work can be 
carried on in a large plant at a less relative cost; (d) the utilization 
of by-products in a large plant can be carried on more economically 
than in a small plant; ( e ) the marketing and selling of the com¬ 
modities in a large plant will be proportionately cheaper than in 
a corresponding number of small units; (/) the purchase of 
supplies can be done more economically by a large plant — through 
buying in large amounts; (g) there is an elimination of competi¬ 
tive advertising, — one form of advertising can be used for a large 
plant instead of four kinds of advertising for .the four small units ; 

( h) better freight rates can be obtained through shipping in large 
quantities — carload and train-load lots; (i) foreign trade can be 
obtained to better advantage by a large plant which allows the 
manufacturer to ship excess production to foreign countries. 

Specialization of industry naturally requires a large market, 
since the organization of an industry in this way means large quan¬ 
tity production. If the demand in this country for a certain 
commodity is limited, such a commodity would naturally be pro¬ 
duced in a small plant rather than a large one. Such a plant would 
not have extreme division of labor. For example, the weaver and 
loom-fixer in the small mill might be one and the same person. In 


BUSINESS ORGANIZATION 


225 


other words, the division of labor in an industry is governed by 
the extent of the market. Large markets mean much specializa¬ 
tion, while a limited market means less specialization. 

With the development of rapid and more extensive transporta¬ 
tion there naturally arise new markets and demands for commodi¬ 
ties. Thus, with the opening up of the South American countries 
came an increased demand for cotton goods. 

Not all industries can be developed along lines of specialization. 
Only those industries that allow all operations and processes to be 
carried on together can be subdivided and organized along lines 
of specialization. The raising of wool, cotton, and silk will not 
allow much specialization. On the other hand, the manufacture of 
raw cotton into sheetings can be organized so that all operations 
can be carried on simultaneously. 

Today the most effective organization of a cotton mill is that 
described the following paragraphs. 

Organization of Cotton Mill. The president of a cotton mill is 
usually not the active head of the business; his position corresponds 
to that of the chairman of the board of directors in the usual 
banking or mercantile corporation. The mill treasurer is, on the 
other hand, the chief directive force, and he performs the two all- 
important functions of buying the milks raw cotton and selling its 
product, either directly or through other channels. In the mills 
of New Bedford and Fall River, which make chiefly gray goods, 
the treasurer usually has his office at the mill. In most other 
New England mills the treasurer is usually a member of a selling 
house and is frequently the treasurer for more than one mill. 

When the treasurer has his office in the mill, the man who has 
charge of the actual operation is known as the mill superintendent. 
His functions include the general management of the plant and 
the purchasing of supplies other than cotton. When the treasurer 
maintains his office in a selling house, the operating head is known 
as an agent and enjoys a greater degree of responsibility and 
independence. There are, of course, a varying number of minor 
operating chiefs in charge of sundry departments. 

The average New England cotton mill contains about 50,000 
spindles, while the southern mill runs about 25,000. The vast 
majority of mills do both spinning and weaving, although some 


226 ECONOMICS OF CLOTHING AND TEXTILES 


southern mills sell yarn, and some Pennsylvania establishments 
do nothing but weave. Of the entire number of spindles in the 
country, 83 per cent, and of looms, 97 per cent, are in the mills 
that do both spinning and weaving. 

In contrast to the tendency towards unification in spinning and 
weaving is the ever-increasing segregation of the converting plants. 



Salesmen 


Chart Showing Mill Organization 

The rise of the merchant-converter, the growing demand for a great 
variety of finishes, and the fact that converting is very much 
cheaper on a large scale, have all brought about an increasing 
tendency on the part of the mill to sell its cloth in the gray, or to 
have it finished on commission. 

While a few large worsted mills spin their own yarn, this is the 
exception rather than the rule. On the other hand, the knitting 
mills finish their product for the market themselves, and sell either 
direct or through a selling house. 

Efficiency. The success of the production and distribution of 
textiles and wearing apparel depends upon each step being care¬ 
fully planned so that there is no waste — that is, with the highest 
efficiency. This means that all the processes must be coordinated 
with those that precede and those that follow, and that there 
must be full cooperation among the workers. 

The following organization is that of a textile mill at South 
Manchester, Conn., that has been conducted by the Cheney 






















BUSINESS ORGANIZATION 


227 


Brothers for several generations: The manufacturing plant, 
exclusive of certain subsidiary utilities, occupies approximately 
thirty-six acres of floor space. The various operating divisions, 
such as the velvet mill, broad-goods weaving mill, dressing mill, 
spun silk mill, yarn and dye mill, throwing mill, cravat mill, velvet 



weave mill, machine shop, and stores, are each housed in a separate 
building or buildings, permitting segregation and efficiency in the 
conduct of the working divisions of the enterprise. In addition 
the company also owns an assembly building and three community 
boarding houses where employees may obtain food and lodging 
at nominal rates. In addition, 450 rentals in about 300 buildings 
owned by the company are rented to employees and their depend¬ 
ents. One can readily see that the size of such a silk mill organi¬ 
zation makes it the leading industry in the community. 

The duties and titles of the persons directing such an organiza¬ 
tion are as follows : All divisional authority is derived from and is 
subject to the board of directors and the president. A main area 
of organization within the company is known as a division, cen¬ 
tralizing under one head correlated functions of administration and 
production, as the broad-goods weaving or the velvet division. 

















228 ECONOMICS OF CLOTHING AND TEXTILES 


Further subdivisions are the department, section, branch, and 
room. The line of authority extends directly down through the 
executive heads of these subdivisions. That is, the head of a room 
is subordinate to the section head, the section head to the depart¬ 
ment head, and the department head to the division head. Thus, 
the division, including one or more departments, is under a single 
executive known as a manager. In this capacity he is a superior 
executive and may have under him one or more department heads, 
known as foremen. 

Departments are of two classifications: the staff department, 
charged with specific portions of the administration and service 
activities incident to the functions of which it is a part; and the 
production department, engaged primarily in production, physical 
maintenance, and operation. Subordinate department executives 
in charge of these two branches of activities are respectively a 
department manager and a superintendent. Section heads are 
known either as section managers or section superintendents, 
according as the section is a subdivision of a staff or of a produc¬ 
tion department. 

A further occasional unit of organization is the branch or subdi¬ 
vision of a productive section which is physically isolated from the 
main part of the section. The head of a branch is known as an 
assistant superintendent and reports directly to the section super¬ 
intendent. The executive in charge of a room within a section is 
known as a foreman. 

The Cheney Brothers organization normally comprises about 
4000 people, exclusive of the sales force, divided approximately 
as follows: 89 per cent wage earners, 6 per cent clerical force, and 
5 per cent supervisory and special employees, including managers, 
superintendents, foremen, and other salaried persons. Sixteen 
per cent of the present salaried group were promoted from clerical 
positions and 58 per cent from mill positions, while 72 per cent of 
the clerical force were promoted from minor mill positions. 

In addition there is a large sales force with salesrooms in New 
York and other large cities. 

Essential Elements of Success. The duties of each official and 
worker in a business establishment should be carefully defined so 
there will be no overlapping, and each should be allowed to do his 


BUSINESS ORGANIZATION 


229 


work without interference from others. Thus he can contribute 
to the business his maximum powers, ability, and best judgment. 

As an incentive to good work and to inspire the confidence of 
workers, certain assurance should be given of permanent employ¬ 
ment and a gradual increase of wages. A successful business 
organization must have loyal and enthusiastic workers, and any¬ 
thing that disturbs these qualities retards the maximum effi¬ 
ciency. 



Cheney Brothers’ Factory, South Manchester, Conn. 


The best results can be obtained only with a willing and efficient 
working force supplemented by highly efficient equipment, build¬ 
ings, power plant, and organization of processes so that there is no 
duplication of effort or waste motion. The setting up of such a 
system requires detailed study of the individual problems of pro¬ 
duction. Too much system that is borrowed from other organiza¬ 
tions tends to hamper the business and is called “red tape.” 
System is what one actually requires to transact the business effi¬ 
ciently, and red tape is the system borrowed from another factory 
or organization. 

The success of system depends to a large extent not only on 
cooperation but also upon coordination — the working together of 
the different departments with the least amount of friction. This 
requires careful planning of all work, up-to-date equipment and 
tools, prompt arrival of raw material and rapid transportation of 
the finished products to the consumer, prompt attention to defects, 
and repairs to tools, machinery, and defects in the organization. 



230 ECONOMICS OF CLOTHING AND TEXTILES 


Efficiency experts are frequently employed to go through business 
organizations and eliminate waste and useless motions and make 
suggestions for improvement. 

Division of Labor. Specialization is the keynote of efficiency 
today and has been growing since the rise of the factory system. 
The work of the old-time craftsman — such as a shoemaker or 
tailor — has been subdivided into a large number of processes. 
To illustrate: In a shoe factory there are over 100 distinct opera¬ 
tions, each requiring a specially trained worker. The same is 
true in making a suit of clothes in a factory. Let us study the 
operations in the manufacture and the repair of shoes and note the 
advantages and disadvantages of such highly specialized factory 
organization. 

Shoe Manufacturing. The principal methods of manufacturing 
shoes are the following : Goodyear welt; McKay; turned; stand¬ 
ard screw; pegged ; nailed. 

Shoes are manufactured in up-to-date factories, employing 
hundreds of operatives. The modern shoe factory is divided into 
six general departments: (1) the sole-leather department, (2) the 
upper-leather department, (3) the stitching department, (4) the 
making department, (5) the finishing department, (6) and the tree¬ 
ing, packing, and shipping departments. 

In some sections of the country, several of these departments are 
designated by other names. The stitching department is often 
called the fitting department; the making department, the bottom¬ 
ing department; and the sole-leather department, the stock-fitting 
department. The departments are popularly termed “rooms’ 7 
for brevity. 

A shoe factory is designed so as to have a width of about fifty 
feet for each room, while the length is determined according to the 
number of shoes to be produced. A width of about fifty feet gives 
plenty of daylight and ample room in the center of each depart¬ 
ment, which is essential in shoemaking. 

Shoe factories are usually about two hundred feet long, although 
many are nearly four hundred feet and a few exceed this length, 
running as long as eight hundred feet. Some are built in the 
shape of hollow squares, while others have wings added which give 
almost as much floor space as the original building. 


BUSINESS ORGANIZATION 


231 


The average factory has four floors. The first floor, or basement, 
is occupied by the sole-leather department. The next floor above 
includes the treeing, finishing, packing, and shipping departments, 
and also the office. The third floor is devoted entirely to the 
making or bottoming department. The top floor is divided so that 
the cutting and stitching departments have each half a floor. 



Section in a Modern Shoe Factory 


There are several exceedingly large factories in this country that 
find it advantageous to divide the factory into more departments. 
For example, the cutting room is divided, so that the linings and 
trimmings are cut in separate departments. The making room 
may be divided so that the lasting is set off as a separate depart¬ 
ment, on account of the many workmen and machines employed. 
In the same way there may be a division of work so that the pack¬ 
ing and shipping can be set apart from the treeing. Again, in the 
sole-leather room, the making of heels and the fitting of the bot¬ 
tom stock may become independent departments. 

The system of making women’s shoes is practically the same as 
that used for men’s shoes except that in a great many factories the 
method of preparing the bottom stock is somewhat different. 
Most manufacturers of women’s shoes do not cut sole leather, but 
buy outsoles, insoles, counters, and heels already cut or prepared. 










232 ECONOMICS OF CLOTHING AND TEXTILES 


These soles are in blocked form and large enough so that they can 
be cut or rounded by the manufacturers to fit their lasts. The 
counters, when bought, are all ready to put in the uppers, while the 
heels are ready to put on the shoes. When a manufacturer of 
women’s shoes cuts his sole leather in his own factory, the system 
is the same as that in the men’s factories. 

In women’s factories where sole leather is not cut, there is 
not a complete sole-leather department. Instead there is what 
is called a stock-fitting department. Independent cut-sole houses 
sometimes supply the soles to manufacturers. The same system 
of buying parts ready finished also applies to many other parts of 
the shoe, such as the top lift, half sole, welt, rand, etc. Manu¬ 
facturers of both men’s and women’s shoes often buy trimmings 
and other parts of the upper all prepared. 

A large proportion of the manufacturers of men’s shoes are now 
buying heels already built, while fully nine-tenths buy counters 
already molded. The soles, and other parts that are needed for a 
shoe, are manufactured in different qualities and grades, so that a 
manufacturer can buy any grade of sole he wants. It is therefore 
considered an advantage to buy some parts, instead of cutting 
them. In a side of sole leather there are twenty-five or more differ¬ 
ent qualities and grades of soles, and very few manufacturers, 
especially in the women’s trade, can use all of these. The greater 
variety of shoes a manufacturer turns out, the more advantageous 
it is for him to cut his own sole leather and prepare all parts in his 
own factory. 

In this country, the number of factories in the shoe trade appears 
to be growing less and the average factory larger. It is estimated 
that there are at present something like 1500 factories in all. 
These range from the smallest output to the largest. The average 
factory may be said to produce about 1200 pairs of shoes per day. 
Many turn out 5000 pairs daily, while a few manufacturers turn 
out 10,000 or more pairs. Several manufacturers and firms have a 
dozen or more factories and have a total output of between 20,000 
and 30,000 pairs of shoes a day. There is no such thing as a trust 
or monopoly of any kind in this trade, and there never has been. 

In all factories and all classes of work, the number of pairs of 
shoes in a “case” is usually one that can be divided by twelve. 


BUSINESS ORGANIZATION 


233 


Thus a case may be twelve, twenty-four, thirty-six, forty-eight, 
sixty, or seventy-two pairs. In children's work it is often sixty 
or seventy-two pairs. Of course, a case of shoes may contain any 
number of pairs, but the numbers given above have always been 
used in regular work. 

Cases of shoes may differ, but all pairs of shoes in any one case 
must be made exactly alike. All shoes are sold in cases, with the 
exception of custom work, single-pair orders, or samples. In 
making men's heavy shoes, or working shoes, the regular case was 
formerly sixty pairs or thirty-six pairs, but the tendency of late has 
been to have a standard case of twenty-four pairs. In the men's 
fine trade, the regular case is twenty-four pairs, while in the 
women's it is thirty-six pairs. Long boots for men have always 
been made in twelve-pair cases. 

Shoes are sold by samples, sent out with a traveling salesman. 
As fast as he receives an order, he sends it to the main office. Here 
the orders are subdivided and sent to the factories making the 
goods. For example, an order for five dozen pairs of men's shoes of 
a certain style is received by the main office from the traveling 
salesman. This is sent to the factory in the form of a typewritten 
order, covering the general description and sizes in the proper 
form, for each case is made according to the specifications on the 
tags made out in the office. These tags specify the kind and qual¬ 
ity of sole, heel, and upper, how stitched, the last to be used, how 
bottomed, finished, treed, and packed. Everything is marked 
plainly on the tags so that a buyer can have any shoe made just 
as he wants it. 

This order is then sent from the factory office to the cutting 
room, where a clerk makes out long tickets. Shoes go through the 
factory in lots of twenty-four pairs, each lot being called a “job," 
and when finished making a case of shoes. The long ticket is made 
in duplicate, and is perforated so it may be tied to a “job " of shoes. 
Both parts of the ticket are made out to indicate the various opera¬ 
tions with the specifications as to detail. The lower part is sent 
to the stock or sole-leather room, while the top part remains with 
the uppers, which are cut in the cutting room. While each part 
of the ticket is sent by a different route through the factory, they 
finally meet when the shoes are assembled into finished products. 


234 ECONOMICS OF CLOTHING AND TEXTILES 


In addition to the long tickets already described, two other 
tickets are made out, the top ticket and the trimming ticket. The 
top ticket is sent to the leather bins of the factory, where the sorter 
knows by experience exactly the amount of leather required to 
cut the order, and is careful to see that it is all of uniform quality 
and free from blemishes. He rolls the leather in a bundle, attaches 
the ticket, and sends it to the cutter. 

In the cutting room there are three classes of cutters: (1) the 
cutter of trimmings, who cuts lace stays, top facings, back stays, 



Factory of United Shoe Machine Corporation, Beverly, Mass. 


tongues, etc.; (2) the outside cutter, who cuts quarters, vamps, 
tops, tips, etc.; and (3) the lining cutter, who cuts cloth linings. 

Monopoly of Machines. In boot and shoe manufacturing there 
is a condition that is peculiar to that industry and no other. The 
machines for manufacturing are leased by one company and can 
not be purchased. The company owning the patents leases the 
machines on a rental basis and agrees to keep them in good running 
condition. Of course such a method means that the machine 
builders have a form of monopoly, but in this case the monopoly 
has really proved a blessing to the industry, and has been upheld 
by the courts. 

In order to understand the conditions that have brought about 
this situation it is necessary to go back two generations in the 
history of shoe manufacture. Up to 1860 shoes were made by 
means of practically the same tools that were employed in the 
early days of Egypt. These early tools were depicted as early 
as the 14th century b.c., as part of a sandal-maker’s equipment. 
To the curved awl, the chisel-like knife, and the scraper of that 
time, the shoemaker of the last century had added only a few 



BUSINESS ORGANIZATION 


235 


simple tools such as the pincers, the lapstone, the hammer, and the 
variety of rubbing sticks used for finishing edges and heels. 

Efforts had been made all over the world at different times to 
perfect machinery for shoe production, but it remained for the 



Vocational School Shop for Training Machinists to Manufacture 
Shoe Machinery 


shoemakers of the United States to invent such machinery. At 
the time of the Civil War the scarcity of shoemakers due to the 
large numbers who went to war caused a great demand for machin¬ 
ery to replace the workers. 

When these machines were first invented, it was found impossible 
to sell them. So the machine builders asked the shoemakers if 
they would permit the machines to be installed free of charge, 
with the understanding that the shoemakers were to pay to the 
machine owners a small part of what the machine saved in produc¬ 
tion costs. To obtain this money for the use of machines, often 
as small as one-third of a cent per pair for the smaller sized shoes, 










236 ECONOMICS OF CLOTHING AND TEXTILES 


McKay, the inventor, issued royalty stamps, which became a very 
important factor in the early days of machine-made shoes. This 
method of renting machines became the regular practice in the 
shoe industry and has continued up to the present. Special 
mention is made of it at this time for the reason that it had two 
important bearings on the future of the industry. 

First, it permitted manufacturers to procure machinery which 
they never would have been able to secure otherwise through lack 
of capital. Second, and probably more important, it developed 
a type of service which is not duplicated in any other industry. 
In shoe production the word “service” was known long before its 
place was determined in any other line of business. McKay 
quickly found that to get his return for the use of the machines it 
was incumbent on him to keep them in operation, and to that 
end his machines were so made that parts were interchangeable. 
He organized a corps of expert men who could be sent wherever 
machines required replacement of parts or readjustment. 

Modern Method of Repairing Shoes. Note the adaptation of 
machinery to shoe repairing. As the shoemaking industry has 
become more and more perfected, there has been an increasing 
interest taken in shoe repairing. A medium-priced shoe of today 
may often be in good condition to be heeled and soled twice. 
Although in the past many shoe stores and departments had their 
shoe repairing done by outside shops, the tendency today is for 
every shoe store to have its own repair department. This method 
has resulted largely from the development of machinery for shoe 
repairing, which is revolutionizing the business to such an extent 
that in a few years repairing by hand will be among the lost arts. 
With the new inventions for restoring upper leather, and improve¬ 
ment in machinery for shoe repairing, repair departments will very 
soon be but little short of miniature factories. 

The machinery ordinarily used consists of the Goodyear stitcher, 
used for attaching soles to Goodyear welts by the lock-stitch method. 
This machine is identical with those used in factories making 
Goodyear welt shoes; and there is also a heel trimmer, a bottom 
finisher consisting of a rapidly revolving roll covered with coarse 
and fine sandpaper, and an opera heel builder for forming concave 
heels. There are two heel machines used for tan and white heel 


BUSINESS ORGANIZATION 


237 


work, one heel being covered with a white cloth, and the other with 
a coarse brush. Adjoining these are usually the shank and heel 
finisher, capable of smoothing and highly polishing a shank or heel 
in about a dozen seconds; the bottom finisher, that grinds and 
smooths down the new sole; and a machine consisting of a heavy 
horsehair brush used for rubbing off dirt before the shoe is finished. 
Another useful part of the equipment is an edge setter, which is 
also identical with the kind used in factories. The shoe stitching 
machines and the parts used in finishing are all operated on one 
long shaft, rapidly revolved by the aid of a motor. It is a fact 
that a shoe can actually be soled and heeled in less than six 
minutes. 

Five or six men are often employed in a repair department. 
When the customer’s shoes are brought in, one of those men cuts 
off the old soles and traces an outline of the new soles on a block 
of the very best oak leather. After these are cut out by hand in 
rough form, they are soaked in water and channeled; that is to 
say, a part of the sole in which the stitches are to be run is turned 
up. A second man, by the use of the Goodyear stitcher, joins the 
sole and welt together with a very strong and tightly drawn lock 
stitch. This is a large machine with a curved, barbed needle and 
awl and a shuttle, and it sews through an inch of leather with the 
greatest ease and speed. There are from 150 to 200 stitches in each 
shoe; moreover, every one of them is locked with heavy wax thread, 
so that there is no chance of their ever giving way. If one stitch 
should break, the other stitches would remain intact, as they are 
independent of each other. Both soles are stitched on in a little 
over half a minute without breaking a thread or stopping the 
machine. 

A coating of rubber cement is now placed in the edges of the 
outsole, and the lip of the channel is smoothed down so that the 
stitches are entirely hidden when looking at the bottom of the 
shoe. The edge trimming is done next with the aid of a rapidly 
revolving wheel, which trims the edges square and true in about 
forty seconds. After this, the shank is finished on a rapidly 
revolving wheel covered with emery cloth. 

Bottom finishing is the next step. This is done on a machine 
having two long cylinders, one covered with fine and the other with 


238 ECONOMICS OF CLOTHING AND TEXTILES 


coarse sandpaper. These cylinders revolve rapidly, and the opera¬ 
tor uses the coarse sandpaper for scouring the dirt and old finish 
off the leather, and the fine sandpaper for finishing the sole as 
smooth as that of any new shoe. 

The brushing-in or smoothing is next done by the horsehair brush 
we have mentioned above. A preparation called a bottom-polish¬ 
ing wax — a sort of white wax — is placed on the brush machine. 
The brush now smooths the surface of the sole, filling in all small 
holes with wax and leaving it absolutely perfect. Finally, the 
shoe is placed against a rapidly revolving brush which finishes the 
uppers with a luster that would make any ordinary bootblack 
green with envy. Another operation that fully completes the 
process is the hardening of the edges of the sole with hot steel, a 
process that produces an edge as hard as iron. When it is polished 
with a black dye, it looks exactly like the sole of a new shoe. 

A few words are necessary with regard to the heel. The old 
heel having been removed, several lifts of new leather in rough 
form are tacked on. The shoe is then taken to the heel trimmer 
and is formed correctly and then smoothed down to a brilliant 
surface on the finely covered revolving wheel. In a few seconds 
it is stained, smoothed, and polished. In less than six minutes 
the shoe is ready for the customer. 

Clothing Establishments. In order to turn out the greatest 
amount of wearing apparel, the clothing industry is highly organ¬ 
ized and standardized, so that each worker is a specialist in one 
phase of production. The organization of the industry requires: 
(a) owners or proprietors, ( b ) a general manager of the whole plant, 
(c) designers and stylers, (d) a superintendent and assistant super¬ 
intendents of each department or room, (e) examiners and shrinkers 
of fabrics, (/) cutters, ( g ) operators of machines, ( h ) inspectors, etc. 
Each employee is trained in one phase of the work, so that he 
becomes skillful in that branch. Some specialize on high-grade 
and others on low-grade clothing. 

Within the last generation a tremendous change has taken place 
in the manufacturing of wearing apparel. Originally clothing 
was made on a large scale in congested old buildings and tenements, 
called “sweatshops/’ where the workers toiled long hours, some¬ 
times under unsanitary conditions. Part of the manufacturing 




BUSINESS ORGANIZATION 


239 


was sent out to poor families who did a great deal of the stitching. 
But today special buildings for the manufacturing of clothing 
have been erected, with up-to-date, well-lighted workrooms, all 
sanitary conveniences, and automatic machinery, so that we may 
say that clothing is now manufactured under the best possible 
conditions. 

An example to illustrate the procedure may be interesting. 
In a cloak factory when the fabrics are received every piece of cloth 



Custom Manufacturing Shop Showing the Draping and Mating 
of the Cloth 


is thoroughly examined by experts with regard to measure, texture, 
and color, and is then sponged by special machinery. All smooth 
cloths and those with finished faces are sponged by copper rollers, 
and the machinery is so arranged that from the time the cloth 
starts until it is folded dry, it is not touched by the operator. The 
cloth is then ready for the cutters, with all its imperfections marked. 
Each cutter has a separate check upon which have been entered 
the particulars about the cloth, style, and proper patterns. If the 
quantity is large enough for the cutting machine, the cloth is 
marked and laid in folds, but small pieces are cut by hand with 



240 ECONOMICS OF CLOTHING AND TEXTILES 


shears. After the cloth has been cut according to the provided 
patterns, the bundles are carefully compared with the orders, and 
a ticket is made for each garment. On this ticket is a place for 
each worker to put his or her number, so that a complete record is 
kept of every hand that works on the garment. The garments then 
go to the seamers, who seam them on machines specially adjusted 
for that particular work, and provided with a fixed gauge that 



Workroom Showing Forms Partially Draped in Muslin 

insures a perfectly uniform seam. Expert seamers can work at 
machines that make 3000 stitches a minute. 

For the detection of any possible mistakes and imperfections in 
the fit, the garments are tried on models before being sent to the 
trimmers. The collars, cuffs, facings, etc., of each garment are cut 
according to the style designed, and with the “body” are sent to a 
workman who particularly excels in that branch of the work. After 
leaving the finisher the garment is inspected again by the foreman, 
and if it is not satisfactory, it goes back to the workman for altera¬ 
tions. After the making of buttonholes and the sewing on of 
buttons and ornaments, the garment goes to the presser. It then 
passes to a final examiner and a model, who are responsible for the 
fit and workmanship, and who see that the materials and trimmings 
are right, and that any changes that may have been ordered to 




BUSINESS ORGANIZATION 


241 


suit certain customers have been properly made. The garment is 
then ready for packing and shipping. 

Records of the shape, cloth, trimmings, buttons, and any other 
parts of the garment are kept in duplicate, so that a copy of any 
garment can be made at any time. Sometimes cloaks that are in 
fashion in the East do not reach the far West until weeks after¬ 
ward, when some particular style may be favored more than 



Workroom Showing Manufacture of Fur-Trimmed Cloth Coats 

another, and the orders will be largest for that style. By turning 
to the records, exact duplicates of any style can be made, provided 
the material is in the market. 

One of the most responsible positions in a cloak factory is that 
of the model or “figure,” and the prosperity of an establishment 
may depend upon securing good ones. 

Let us make a comparison of the making of customized men’s 
clothing today and a hundred years ago. The making of such 
clothing is essentially a handicraft even today. 

A hundred years ago customized men’s clothing was made in a 
small establishment under the merchant tailor, — who was usually 
the designer, — several journeyman tailors, and a few apprentices, 



242 ECONOMICS OF CLOTHING AND TEXTILES 


The merchant tailor had a limited supply of fabrics to select 
from. 

The journeyman tailor of the early days was a general all-round 
tailor, not a specialist. He made all kinds of garments — coat, 
trousers, vest, overcoat, etc., and did it all himself, from shrinking 
and cutting out the cloth to the final pressing. 

The merchant tailor usually took the measurements of the cus¬ 
tomer and assisted him in selecting the fabric. Then the cloth 



Millinery Room Showing a Customer Trying On a Hat 

was shrunk, and a pattern made, based upon .the measurements. 
The cloth was cut from the pattern and then the pieces were 
stitched together by hand with the trimmings. One tailor would 
do all the work on the suit. The journeyman tailor in the custom 
shop follows a round of minor operations which keep him constantly 
changing from basting to stitching, to pressing, to basting again. 
There are thirteen different operations in making one pocket, and 
when he has made this pocket he has made only a very small part 
of the suit. 




BUSINESS ORGANIZATION 


243 


All stitching was done by hand up to 1865. At that time the 
sewing machine was placed on the market. One sewing machine 
could do the work of ten men on certain types of stitching. 

Since people usually order or purchase clothing at the beginning 
of each of the four seasons, it follows that tailoring was seasonal. 



Interior of a Well-Developed Clothing Manufacturing Estab¬ 
lishment, Showing Good Light and Surroundings 

There were brief periods of being very busy and longer stretches 
when there was no work at all. For the worker this meant long 
hours at top speed for a very short time and then weeks together 
when he was “out of a job.” 

For the master, no business meant no profits. So when work 
was slack, they had their workers make garments of the cloth left 





















244 ECONOMICS OF CLOTHING AND TEXTILES 


on hand. It was not logical for the master tailor to offer these 
ready-made garments to his own regular patrons, and thus curtail 
his custom business, so he tried to dispose of them in other channels. 
Thus the ready-to-wear business started. Some employers began 
to specialize in this field and became manufacturers of ready-to- 
wear clothing. 

Those tailors who were a little more aggressive and successful 
than the average soon developed business beyond their own ability 
to produce. So they employed assistants and had each do the work 
for which he was best fitted. Those most skillful with the shears 
spent all their time cutting out the garments. Those most skillful 
with the needle did only the fine needlework. Less skillful workers 
handled less important details in making the garments. 

Thus the ready-to-wear clothing business began as an after-part 
of the customized clothing. It has grown by leaps and bounds. In 
fact the rise of the ready-to-wear clothing business, both wholesale 
and retail, has been so rapid that most men of middle age can span 
the entire period within their own memory. The success of the 
industry in conquering its shadowy past, in overcoming suspicion 
and prejudice, has been so complete that it is interesting to consider 
the factors which have contributed to its present-day suprem¬ 
acy. 

In making very cheap ready-to-wear clothes, *and even for clothes 
of medium good quality, one thickness of cloth is laid on another 
until a pile is built up — perhaps twenty thicknesses high, or in 
extreme cases, fifty. Cardboard patterns of the exact size wanted 
for each individual piece of cloth that is required in making the suit, 
some twenty in number, are laid out on the cloth, as close as possi¬ 
ble, and the outline of each pattern is marked on the cloth with 
chalk. 

Then a band saw driven by an electric motor cuts through the 
pile along the chalk marks, cutting out the parts for as many suits 
as there are thicknesses of cloth in the pile. Since the heavy pile 
of cloth is soft and yielding, at the bottom of the pile the pieces 
cut by this method are liable to be a little different in size from 
those at the top. 

A different person performs each of the different operations in 
assembling the parts of the clothing, and does nothing else, week 


BUSINESS ORGANIZATION 


245 


in and week out. The baster does nothing but basting, the machine 
operator does nothing but run the sewing machine, the presser does 
nothing but pressing, and so on. In this way he acquires both a 
speed and a skill which would be impossible of attainment on the part 
of a man whose time is split up among many different kinds of 
work. 

Formerly the measurements were selected so as to fit as wide a 
range of figures as possible by being made loose, baggy, and 
shapeless. In those days there were no investigations of average 
proportions so that each garment might be made to fit a definite 
figure such as (a) tall stout, ( b ) tall thin, (c) tall medium, ( d ) me¬ 
dium stout, ( e ) medium medium, (/) medium thin, ( g ) short stout, 
( h ) short thin, (i) short medium, etc. 

As time went on more and more clothing houses of the cheap and 
medium types were started, competition became still more bitter, 
and prices and quality were forced still lower. More and more 
was taken out of the materials, the methods of tailoring, and the 
pay of the workers, until practically all ready-to-wear clothes were 
made by underpaid people working spasmodically at high speed in 
very undesirable surroundings. The resulting garments were 
totally lacking in style, quality, and tailoring, and were known as 
‘ 1 hand-me-downs. ’ ’ 

In many cases the cut garments were let out to contractors who 
sent the cut pieces to women and children at homes to do the 
stitching. These young children often worked long hours in dark 
and stuffy rooms and kitchens. Such homes were usually in 
tenements and when used for producing clothing came to be known 
as “sweatshops.” 

This cheap ready-to-wear clothing found a market because it 
was cheaply made and could be sold at a low price. Merchant 
tailors, on the other hand, who made custom-made clothing, pro¬ 
tected themselves against this new competition by stressing the 
quality of their product. From this it is evident how rapidly and 
how naturally the two branches of the trade became entirely 
distinct, one selling its product on the basis of low price, the 
other on the basis of quality. 

As time went on, the manufacturers of ready-made clothing 
began to look after the selling of the garments to clothing stores. 


246 ECONOMICS OF CLOTHING AND TEXTILES 

In this way, they could do an extensive business with a small organi¬ 
zation and with very little capital. 

An American, Elias Howe, invented the eye-point needle. 
Wheeler, Wilson, and Singer developed other fundamental features 
of the present-day sewing machine and it came into general use 
about the time the ready-to-wear clothes industry was so rapidly 
expanding. No doubt it was a great factor in that expansion. 
Because it was much cheaper than hand work, the sewing machine 
was used in the men’s clothing industry to such an extent that 
“ready-made” came to mean the same thing to the public as 
“machine made.” But the economies effected by the sewing 
machine were offset by certain very real drawbacks. Garments 
made in this way were stiff and wooden looking. They completely 
lacked softness and grace and style, for even the perfected sewing 
machine of today cannot begin to duplicate the shaping and form¬ 
ing of the garment under the touch of skilled human fingers. So 
some manufacturers once more turned to hand work in their shops. 
To throw out the sewing machine entirely would have made their 
clothing too costly to sell or at least to sell readily. They substi¬ 
tuted hand work in one or more important places and called their 
product “hand tailored.” 

As we have referred to the shortcomings of the sewing machine, 
in all fairness let us recognize its advantages. It is so tremendously 
quicker than the hand that in many of the operations in making a 
suit of clothes one machine will equal the output of eight or ten 
handworkers. Its use enables the public to get a suit of a given 
quality of cloth at a lower price, or to get a better quality of cloth 
at the same price as asked for a garment containing more hand 
work. 

Between the custom-made and ready-to-wear clothing came a 
demand for customized clothing made on a factory basis. After 
the panic of 1893 came a period of unprecedented commercial 
expansion. This brought to the clothing business, as well as to 
many other lines, the opportunity and incentive to “trade up,” that 
is, make better ready-to-wear clothing under better conditions. 
The period of 1900-10 saw the erection of many magnificent 
tailoring establishments, in which all the work could be done 
under one roof and under close supervision according to one 


BUSINESS ORGANIZATION 


247 


standard of quality. This centralizing of all of the operations in 
making garments in one building is called the “inside shop.” 

The result was the establishment of a large number of high-grade 
establishments, where it was possible to manufacture clothing with 
a variety of fabrics in numerous sizes and with care in the manu¬ 
facture to give the effect of custom to ready-made clothing. The 


tm ---{fiii o 
Spill i Mm lie 
Si in "*.<»< V3 

”1 i ii m frlfeiS 

T1 P5 2 ,rr I:^S 
nn [;. [[( 




Modern Factory for Men’s Clothing 


large establishment can buy bolts of cloth selected from 500 to 
3000 different patterns each spring and fall. Furthermore, the 
manufacturer buys nowadays direct from woolen mills which are 
in competition with others at about two-thirds the price paid by the 
merchant tailor. Similar savings apply to the purchase of canvas, 
haircloth, silk sewing thread, etc. 

Thousands of garments may be cut over a single pattern devel¬ 
oped by the designer of a wholesale establishment, whereas a mer¬ 
chant tailor’s cutter must make a different pattern for each customer. 

Today tailor-made clothing, according to individual measure¬ 
ment, is usually made in a small shop, while the ready-to-wear 
clothing, made from a few measurements, is standardized and is 
made in a factory. Each custom-made suit is different, while in 
the factory there is standardization for a certain group or class. 
The same condition applies to high-grade fabrics, where the quan¬ 
tity of each pattern is limited by the trade. Articles of clothing 
wanted by a few people must be made by small-scale methods and 
are not suited to factory manufacture. 

Home Dressmaking. Very few people realize the amount of 
home dressmaking that is carried on in the United States, particu- 










248 ECONOMICS OF CLOTHING AND TEXTILES 


larly in the rural sections. This work is done because the home 
makers feel it can be done at 


Lower cost.90.2 per cent 

Better materials.75.2 per cent 

More nearly meet individual needs.54.9 per cent 

Good ready-to-wear stores inaccessible... 7.8 per cent 


In order to guide home makers in doing this work retail stores 
have attempted to assist, but most assistance has been obtained 
from the purchase of commercial patterns, for it is quite obvious 
that if the fashions offered these women in the leading paper 
patterns manufactured today did not closely parallel those featured 
in ready-to-wear — if the patterns themselves had not been stepped 
up in efficiency to the point where they made the labor and effort 
expended in making a garment practically nil — home dressmaking 
would not occupy the important place that it does. 

How strong is the fashion element in commercial patterns? 
So strong that the pattern manufacturers make seasonal visits to 
Paris just as the ready-to-wear purveyors do. So strong that they 
actually buy what to them are the outstanding models and bring 
them to this country for quick, accurate reproduction in their 
patterns. These designs are not necessarily exact patterns, seam 
for seam. Very often it is necessary to simplify the garment a 
trifle so that the home sewer will have no difficulty in reproducing 
it. But the reproduction is always true to the spirit of the original 
— it invariably retains the chic that characterizes Parisian creations 
at their best. 

Let us discuss the four reasons given by women for making their 
clothes at home. The first of these is economy. Economy in home 
sewing today differs greatly from the economy of many years ago. 
At that time we had a picture something like this — a woman 
wanted a new frock. Ready-to-wear at that time not having 
reached the peak of speed in copying and low cost in manufacturing 
that it has today, it is quite possible that that woman would have to 
pay nineteen or twenty dollars for a presentable dress. By buying 
her pattern and fabric and making that dress, however, she would 
probably save anywhere from five to ten dollars. The same was 
true of clothes for her entire family — thus we find Mrs. Blank 





BUSINESS ORGANIZATION 


249 


sewing for herself and her young sons and daughters as well. 
The present situation is slightly different. Economy today has a 
quality aspect. A woman can buy a ready-made dress for any 
price from five dollars up. This dress may boast the newest ideas 
in fashion and very appealing lines. Yet, in the lower price levels 
it is certain to be but one of many hundreds, even thousands, like 
it. Its material is apt to be shoddy. Seams are sure to give sooner 
or later. Compare this dress with one made by this woman 
herself from a modern commercial pattern. In the first place, 
she has a Paris model — smart, authentic, good looking. In the 
second place, she is assured of material of good quality even if she 
pays as little as one dollar a yard. She is permitted to exercise her 
own imagination and taste in the selection of color, trimming, etc. 
She knows her finished dress won’t be one of thousands like it — 
and she knows it will fit her perfectly. This dress may cost her 
exactly what she would have paid for the inferior ready-made 
model. It may even cost her a few dollars more. Yet the original 
of her Paris frock probably cost the pattern manufacturer who 
purchased it in Paris $200 or $300. Therefore, this woman is 
exercising economy in the modern sense. 

The second reason — better materials — has been covered under 
the heading of economy. The fourth — no good ready-to-wear 
source within reach — can be overlooked; the percentage giving 
that reason is very small and undoubtedly has decreased greatly 
in the past five years. But the third — more nearly meet individ¬ 
ual needs — is of the utmost importance. Every woman has some 
figure problem. There are few if any women who can step into a 
size 14, 16, 36, or 42 dress without need of some alteration or 
adjustment somewhere. In lower-priced ready-to-wear, good fit 
for a woman with any figure fault is practically impossible. In 
ready-to-wear at higher prices, the customer is charged for altera¬ 
tions. By using a commercial pattern with a good alteration chart, 
the correction can be made in the foundation of the frock — the 
pattern itself — and the finished garment is sure to fit comfortably 
and smartly. To the larger woman — the woman who wears a 
size above 42 — this feature of paper patterns is extremely impor¬ 
tant. It is almost impossible for this woman to secure correct fit 
in a ready-made garment except at prohibitive cost; yet by making 


250 ECONOMICS OF CLOTHING AND TEXTILES 

her own clothes or having her dressmaker make them from stand¬ 
ard makes of paper patterns, she can be sure of achieving the fit 
she needs and desires at a nominal price. 

There is probably no other field save the purely mechanical in 
which improvements have been so consistent and so important as in 
the field of commercial patterns. The aim and ambition of the 
pattern manufacturers has been primarily to make it simple in the 
nth degree for a woman to make her own clothes — and to make 
them smartly. Thus we have seen the introduction of the new 
cutting ideas into the pattern field, such as a printed cutting line. 
Separate construction sheets have been simplified again and again, 
and re-illustrated until it is now possible for a woman to follow 
every detail in a garment’s construction in graphic picture form. 
Cutting layouts for each individual size are another prominent 
feature of modern commercial patterns; not only do they insure 
greater perfection of result, but they also save the pattern user the 
cost of wasted material. 

This is truly an age of economy. Yet good taste, individuality, 
and fashion have their place in the modern scheme of things as 
well. And the commercial pattern with its present-day perfection 
of mechanical details and its close affiliation with the center of 
fashion is undoubtedly one of the first and most important sources 
of supply for smart clothes at modest prices, particularly for people 
of limited income and much leisure time, such as are found in 
small communities. 

Handicraft vs. Factory System. A comparison between the 
productiveness of a worker under the handicraft system compared 
with the factory system may be of interest. 

1. Two weavers were required for each wide hand-loom, but 
with the invention of the fly shuttle one weaver was able to 
manipulate the loom. The production of the loom increased 
100 per cent. 

2. Power spinning machines enable one man to produce as much 
yarn as 250 to 300 hand-spinners could produce. 

3. A hand-loom weaver would weave 8 yards of carpet, while 
a power-loom weaver on a single loom could produce 40 yards. 

4. With automatic stop-motion looms one weaver can operate 
as many as 85 looms at once, assisted by a bobbin boy. 


BUSINESS ORGANIZATION 


251 


5. Power printing machinery of textiles with one operator can 
produce as much as 100 men and 100 boys on block prints. 

6. With 1,500,000 people in spinning mills, the production 
would equal that of 40,000,000 on one-thread spinning wheels. 

7. The rate of hand-sewing was between 30 and 40 stitches per 
minute per operator. The foot-power machine operated by a single 
person makes 900 stitches per minute, or the equivalent of 30 
people working on hand stitches. Power sewing machines operated 
by a single person make 4000 stitches per minute or the equivalent 
of 133 people hand-sewing at once. 

Under the old-fashioned handicraft system the small shop, 
composed of the owner, a number of workers, and a few apprentices, 
was the organization. Hence, neighbors and owners and workers 
were closely related, and the owners felt that the great prize in life 
was achievement (good workmanship), good name, and the respect 
of workers and the community. Profits were small. 

During the handicraft period population was fairly constant, 
was fairly evenly distributed and slowly increasing in numbers with 
industrial labor in close contact with the soil. This gave a self- 
sustaining and well-balanced relation between the necessities of 
labor and earning power, so that prices, wages, rents, and employ¬ 
ment were fairly constant. 

Under the factory system the relations between employer and 
employee are distant. Owners frequently live at a distance, and the 
workers have little chance to voice their sentiments in the organi¬ 
zation. Profits are frequently the chief incentive under the factory 
system. Each invention of machine or process causes a disturbance 
by enlargement of plant and replacement of workers — causing 
more or less unemployment, poverty, and much unrest among the 
people by upsetting the economic balance, the number of workers, 
and the work to be done. 

Effects of Specialization. Specialization has certain advantages 
and certain disadvantages. The advantages may be summarized 
as follows: (a) greater skill, due to repeated operations; (6) work 
so arranged that each operation follows in order from one end of 
the factory to the other, thus saving time, and permitting each 
operation to be thoroughly learned;, (c) the operations may be 
classified according to skill and technical intelligence required, so 


252 ECONOMICS OF CLOTHING AND TEXTILES 


that all types of mentality and skill may be employed; (d) as the 
highly specialized operator, the worker concentrates on his work to 
such a point as to conceive devices and improvements that naturally 
lead to new inventions; ( e ) each machine and worker under normal 
conditions is kept busy all the time under highly specialized skill, 
so that there is no waste of equipment, production, etc.; (/) highly 
specialized work is monotonous, but may be adapted to people of 
limited skill and intelligence and requires little if any think¬ 
ing. 

The disadvantages are as follows: (a) utilization of women and 
children in the simpler operations — spinning, weaving, etc. — at 
low wages and long hours; (6) each worker under this system de¬ 
pends upon the assistance of every other worker — spinners on 
carders, and the weavers on the spinners — thus if one group is 
not employed, the others must also be laid off; (c) due to frequent 
changes of processes and the invention of new machinery, much of 
which may be automatic, frequently groups are victims of tech¬ 
nological unemployment. 

Effects of Mass Production. With such large-scale methods of 
production have come certain changes, such as the following: 

(a) Tendency to standardization with regard to pattern, style, 
and size, not allowing as much individual freedom of selection of 
style as in foreign countries. Personal wishes are gratified to the 
highest degree by distinct individual styles. 

(&) The production per worker is very great, and while the work 
has a tendency to make the workers part of the machines and to 
allow for very little individuality in design or craftsmanship, never¬ 
theless it does give a shorter day, more leisure, and a chance 
to enjoy the higher intellectual studies and the freedom of the open 
air. 

(c) It develops a splendid spirit of cooperation among all. Those 
of a distinct individual type are eliminated in the struggle for 
leadership under the plan of industrial organization. 

(d) The development of industry on a large scale has separated 
the business man and the worker so that their spirit of direct 
contact is gone. It also makes the business man and others called 
capitalists very much richer and absorbed in the materialistic 
development of industry, often at the expense of the workers. 


BUSINESS ORGANIZATION 253 

There is thus created a wide gap between them so that all differences 
are highly magnified as questions between capital and labor. 

Small Industries. In the development of industries during the 
last generation or two there has been a movement toward large 
units of manufacturing operation, in some cases employing 5000 
people in one plant. The Wood Worsted Mill is the largest worsted 
mill in the world, and has 3,080,180 square feet of floor space and 



Largest Worsted Mill in the World 
Wood Worsted Mill, Lawrence, Mass. Note the length, the structure 
(called mil] construction), and the good lighting. 


employs over 5400 people. There are similar large mills for cotton. 
Such a plant may be very efficient in prosperous times, when orders 
are received in large numbers. But at times of depression or 
panic, when only small orders are given to meet actual needs from 
day to day, such a plant becomes inefficient because the overhead is 
so great that only large orders can be economically filled. 

The importance of the smaller unit in the industrial scheme of 
things is emphatically driven home when one contemplates the 
fact that among the thousands of manufacturing establishments 
in all parts of the United States approximately only 3 per cent 
employ more than 250 wage earners and only 1.4 per cent employ 
more than 500. It is even more interesting to note that plants hav¬ 
ing working forces of 500 or less employ 62 per cent of our industrial 
wage earners. From these statistics it is apparent that the policies 














254 ECONOMICS OF CLOTHING AND TEXTILES 


and problems of these companies are necessarily an important fac¬ 
tor in American industrial development. Nor can any plan for 
social or economic betterment be considered which does not include 
consideration of the problems of both employer and employee in 
this important group. 

The policies of these smaller plants, especially in matters that 
affect social welfare, are becoming the subject of general attention 
and interest. Particularly during the recent business depression, 
it has been shown that no matter how well certain larger organiza¬ 
tions may provide for the common hazards of employment, in so 
far as their own employees are concerned, a general acceptance by 
smaller establishments of similar responsibilities is necessary for 
effective results. That such action by smaller plants is often more 
difficult because of limitations of size and resources is conceded, but 
many small plants have worked out solutions of these and other 
administrative problems. 

During the depression of 1930-1932, a movement has taken place 
in favor of the smaller units of industry, and they have been 
organized to become very efficient. They are efficient, not only 
financially but also from a social point of view, because they can 
exist in smaller communities. Large communities are not eco¬ 
nomical because their size involves such costs as subways, motor 
systems, etc. which are noticed in the tax rate. The cost of living 
in a smaller community is cheaper and allows better facilities for 
family life — a separate house, garden, etc. 

Workers. The success of every business organization depends 
upon a spirit of cooperation and loyalty upon the part of the 
workers — often called esprit de corps. A working force having 
as its background varied racial traditions, wide variations in age, 
earning capacity, length of service, education, training and skill, 
and many differences in point of view and reaction to conditions 
must be molded into a homogeneous unit and coordinated to 
fulfill the purposes of the management. This function and this 
responsibility have been delegated to the Industrial Relations 
Division of many factories and textile industries. Such a de¬ 
partment has the following organization in one of the largest and 
most efficient mills in the United States, Cheney Brothers, South 
Manchester, Conn. 


BUSINESS ORGANIZATION 


255 


Subject to the final authority of the President and the Board of Directors 
of the company, the Industrial Relations Division is directed by a manager and 
an assistant manager. At the present time, the manager in charge is a member 
of the Cheney family, and thus serves as a very direct link between manage¬ 
ment and industrial relations activities. The actual work of the division is 
conducted through seven departments: Placement, Employment and Training 
Department, Employee Aid and Insurance Department, Medical Department, 
Education Department, Plant Safety and Sanitation Department, Housing 
Department, and Service Aides Department. The last department is in reality 
a personnel liaison service. 

Responsibility and General Functions 

Subordinate executives in the Industrial Relations Division, directing the 
various activities, include supervisors of employment and of employee training, 
a medical supervisor, a supervisor of insurance and the mutual benefit associ¬ 
ation, a supervisor of the housing department, and three departmental service 
aides. Although in the subsequent discussion, the specific activities of the 
Industrial Relations Division have been arbitrarily assigned to the various 
departments, it is well to point out that they are really the functions of the 
Industrial Relations Division as a whole and are under the general control of 
the manager and assistant manager of the Division. 

The Industrial Relations Division has no fixed policy, in the sense of an 
established procedure to which it must adhere. The program in effect at any 
time is the one calculated best to accomplish the results desired. If any 
feature of this program fails to justify its continuance, it is dropped and new 
activities may be introduced as the need for them is demonstrated. The 
Division operates through four well-defined channels, which designate its 
authority and limitation of authority. These channels are: as representative 
of the President; as representative of the Company and auxiliary companies; 
through recommendatory cooperation; and in direct control of industrial 
relations activities. 

Representative of the President. The industrial relations manager is charged 
with the preparation of material to be presented to the works council and the 
foremen’s conferences, and in doing so assists the individual selected to present 
this material. Also, in his capacity as a representative of the President, the 
industrial relations manager may be represented at any departmental works 
council meeting and at any foremen’s meeting. Such representative may take 
part in the discussion and may suggest and advise with the works manager or 
superintendent in charge, in any way that does not conflict with the authority 
of the person conducting the meeting. 

Representative of the Company. The industrial relations manager also acts 
as representative of the Company with outside authorities, where there is a 
community of interest in the conduct of schools, recreation centers, hospitals, 
health, sewer and sanitary control, town charities, town police, public utilities, 
and manufacturing and employees’ associations. It is also the duty of the 
manager of the Division to keep in touch with recently enacted or pending 
legislation which relates to matters under his supervision. 

Recommendatory Cooperation. Thirdly, the industrial relations manager 
acts as adviser and, if necessary, as mediator when such matters as compensa¬ 
tion or discipline are at issue between employees and the production control. 
He takes an active part in the establishment of general wage scales, sup¬ 
plementary forms of compensation, and all rules governing discipline and 
relating to working conditions. He may make recommendations for the 
employment of certain individuals, including the temporary assignment of 
injured employees, and for transfers, promotions, layoffs, and eliminations. 
He has the power to make final recommendation for pensions or part pensions 


256 ECONOMICS OF CLOTHING AND TEXTILES 


to the Board of Directors, the right to advise with superintendents and fore¬ 
men as to grievances of individuals, and the power to make such investigations 
as appear necessary. . . . 

Direct Control of Activities. The administration of specific activities m the 
industrial relations program is the fourth and most conspicuous function of the 
Industrial Relations Division. The effectiveness of the program is „in large 
part dependent upon the successful functioning of these activities. The 
manager and assistant manager of the Division supervise all activities, but 
administration of particular activities is usually assigned to one department. 


Departmental Organization 

The many activities that come within the scope of the Division’s operations 
may be grouped somewhat definitely under the various departments. The 
accompanying chart shows the general organization under these departments. 

Employment , Placement, and Training. Through the employment bureau 
applicants for employment are interviewed and tested, and recommendations 
for employment are made to the various operating divisions and departments. 
General methods and principles of selection are adopted subject to the approval 
of the manager of the Division. Training of all “learners” is supervised dur¬ 
ing the period of adjustment. This is done in separate training sections when 
practicable, otherwise under the foremen and superintendents. 

Medical. Through the medical department the Division supervises all 
plant medical work, including outside nursing, physical examinations for 
employment, and optical, dental, rc-ray, physiotherapy, and laboratory work. 

Employment Procedure. All applicants for positions with the company must 
pass through the employment department, regardless of who may first have 
suggested them for employment. While the recommendation of individuals 
for employment by present employees, including managers, superintendents, 
and foremen, is welcomed, this does not alter the essential routine. Following 
a satisfactory interview and physical examination, and in certain cases an 
intelligence test, the applicant is sent to the department superintendent. If 
acceptable to the superintendent, he is referred to the foreman, who has the 
right of final decision as to acceptance or rejection. 

Individual merit is the leading consideration upon which employment is 
based. Other considerations which are taken into account and which may be 
determining factors in cases of nearly equal merit are, in the order of importance 
attached to them: present employment in good standing in another depart¬ 
ment of the company; former employment with the company, with a good 
record; completion of the cooperators’ textile course and all-day textile 
course at a trade school; and residence in the town of Manchester. 

Intelligence tests are prescribed for all applicants for office positions and may 
be required in other instances where they are considered applicable. These 
tests are used to provide supplementary information as to an applicant’s 
special aptitudes or weaknesses rather than as a basis upon which to accept 
or reject the applicant. 

Employment of Minors. No child under sixteen years of age is employed 
unless such employment is in connection with a student course in textiles in 
cooperation with the State Trade School, or is under the supervision of the 
training section of the Industrial Relations Division. All applicants under 
sixteen years of age must comply with the Connecticut State law and can not 
be employed more than eight hours in one day. This, of course, does not apply 
to students taking the supervised textile course. 

Employment of Married Women. The policy of the company does not favor 
the employment of married women, particularly those with minor dependents. 
Single women are at all times preferred, although married women without 
children may be accepted for permanent employment if they have passed a 


BUSINESS ORGANIZATION 


257 


DEPARTMENT SECTION SUB-SECTION 



Organization of the Industrial Relations Division 










































































































































258 ECONOMICS OF CLOTHING AND TEXTILES 

Se a^subiect prior to employment, to special investigation to establish the 

S that the children will be properly cared for during working hours and that 
fact that the cmiaren wii ivvy y - j' ^ Even when the report of such 

”yeI S by moBt C rt r he foremen in charge of. actual products work, al- 

th SfS“»;S P AppUclnS Xo arTineligible for regular employ- 
mpnt hut who desire restricted employment are placed only m such jobs as are 

IP-,° 

SS^Snfsuch 
employeewas engaged is reported to the department superintendent, who must 
advise^the employment department within two weeks as to the disposition 
made of the case. All waiver cases, in which the company is released from 
responsibility for certain possible contingencies, are required to have waiver 
papers properly signed and witnessed by an agent of the State Compensation 

C °Wr" 1 'tran^Twhatever nature, must be effected through the 
employment department and are subject to the approval of the medical depart 
ment Y Such requests for transfer as come from the employee are made first to 
the proper foreman and then to the employment department. The application 
is then submitted for approval to the superintendent of the department in which 
the emnlovee works. Upon notification of such approval, the employment de¬ 
partment places the application in a preferred classification to await transfer. 
P Superintendents and foremen are expressly forbidden to approach employees 
of other departments with regard to transfer unless the employment depart¬ 
ment has referred the employee to them. When the superintendent of a 
department finds a reduction in his workmg force necessary, he notifies the 
employment department of the employees available for transfer If^transfers 
are P not effected within a reasonable time, employees are laid off and referred 
to the employment department. To prevent subsequent unpleasantness, 
special wage increase or promotion can not be granted to a temporarily trans¬ 
ferred employee without the approval of the superintendent of the department 
in which the employee is regularly employed. . 

Superintendents take up with the employment department, in writing, cases 
of employees who are no longer able, because of physical incapacitation, old 
age or for other reasons, adequately to perform the tasks to Which they are 

assigned, and for whom other and less exacting jobs should be found. 

When a superintendent considers that an employee is disqualified for further 
employment in his department, he may either discharge him from the depart¬ 
ment or communicate with the employment department relative to his trans¬ 
fer All cases of departmental discharge are reported to the manager of the 
Industrial Relations Division. Employees may be finally discharged from the 
company only through action of the employment department 

When curtailment necessitates a reduction in the force, the basis of retention 
of employees is mainly their value to the company. This is determined on 
the basis of the employee’s credit rating, which includes years of service, 


BUSINESS ORGANIZATION 


259 


regularity of attendance, productivity, quality of product, and citizenship. 
In the case of individuals whose other qualifications are substantially similar, 
the company retains those who are under the necessity of supporting them¬ 
selves, in preference to those who have other means of support, and unmarried 
women. 


Training 

The employment department at Cheney Brothers retains supervision over 
the new employee until he or she is able to enter the ranks of fully-qualified 
employees. The training sections are, therefore, under the control of this 
department, subject to the supervision of the manager and assistant manager 
of the Industrial Relations Division. 

Training Units. Training units are maintained for instruction in spindle 
operations, broad goods weaving, velvet warping, velvet twisting, velvet 
weaving, and cravat making operations. Instruction in spinning includes 
transferring, winding, doubling, first and second spinning, reeling, tubing, 
and quilting. Parts of two departments are concerned with training in broad 
goods weaving, and twenty-four looms in each department have been set aside 
for instruction purposes. Velvet twisting is first taught upon specially 
constructed frames; and later the learner is given more advanced training 
and experience on production jobs. A special demand for velvet weavers 
has resulted in the assignment of twenty-six looms, one head instructor, four 
weaving instructors, and one loom-fixing instructor to this section. Instruc¬ 
tion in cravat making is carried on in conjunction with production work, and 
includes training in threading needles, pinning, folding, slipstitching, hemming, 
pressing, and inspection. 

Occasionally graduates of colleges or higher textile schools are given an 
intensive course of training in all mill operations. A special program is laid 
out for these students in order to expedite the completion of their training, and 
while no special instructors are assigned to this work, the progress of these 
students is closely followed by the head of the training department. 

Cooperative Students. The Cheney Brothers’ plant has maintained close 
touch with the cooperative high school and trade school course conducted in 
South Manchester, where many of their employees receive both academic 
and trade instruction. Students are given practical experience in the various 
production departments of the mill one-half day each week during the school 
year and full time during the summer. These students are paid by the com¬ 
pany while in school at the rate of twenty cents an hour during the first two 
years, twenty-five cents an hour for the third year, and thirty cents during 
the fourth and final year. A bonus of five cents per hour is paid to those who 
attain a grade of 85 per cent or over. Upon graduation these students are 
taken into the mill to receive a further course of training in various mill oper¬ 
ations for an additional three years. 

The philosophy that underlies and has created the industrial relations 
program has had an important bearing upon its development. It is a phi¬ 
losophy which recognizes the indispensability of capital, management, and 
labor for the joint operation of productive facilities, although the first two 
elements are synonymous in this enterprise, but draws sharp distinctions 
between the responsibilities and the return due to the two parties. Manage¬ 
ment will manage without interference; it will determine policy and administer 
it; it will, upon the same premise, receive the profits and suffer the losses. 
The working force is in the plant to operate the facilities for production. The 
worker is entitled to safe and sanitary working conditions, a fair wage, and 
just treatment. Anything in excess of this legal and social obligation lies 
within the discretion of the management to give or to withhold. The fact that 
in actual practice the Cheney management has given much and made generous 



260 ECONOMICS OF CLOTHING AND TEXTILES 

provision, for the welfare, economic and otherwise, of its working force does 
not alter the cardinal principle that it has been the pleasure, not the obligation, 
of the management to do this. 

This attitude of the management is well exemplified in the form of employee 
representation at the Cheney plant. The works council is intended to serve 
as an educational agency to inform representatives, and through them the 
entire working force, about the general problems management is facing, and 
also to give collateral information with regard to the various branches of the 
company’s operations. Minor misunderstandings and difficulties are taken 


Ribbon Loom Weaving Neckties 
Cheney Brothers’ Factory 

up and settled. Recommendations to the management are encouraged. 
Recommendations upon important questions of plant policy are only advisory 
in nature, but this does not appear to lessen the interest of employees in council 
activities. 

There is no misconception on the part of the management that the plans 
and activities of the Industrial Relations Division are of themselves sufficient 
to maintain satisfactory relations with employees. It is well understood by 
the management and in a large degree by workers that such plans are but the 
mechanics aiding in the interpretation of the “Cheney spirit” which underlies 
and permeates the personnel relations. Thus an attempt at evaluation of 
the industrial relations program upon the sole basis of its value in dollars and 
cents would serve little in determining its true worth. The returns in employee 
cooperation, loyalty, and morale are rated high at Cheney Brothers but are 
not easily measurable. 

Wages. Good wages supply one of the most important factors 
in determining the success of a mill or factory. Most disagree¬ 
ments arise concerning the matter of wages. 




BUSINESS ORGANIZATION 


261 


Wages and hours of work of one of the best mills during a 
hundred years are as follows: The weekly hours of work ranged 
from 72 to 60. A 48-hour week with overtime was introduced about 
August, 1927. Members of the mill owner’s family, working 72 
hours per week in 1843, received from $28 to $48 for three months’ 
work, and were paid quarterly. These earnings are now exceeded 
by many employees of a single week’s work of 48 hours. 

Since 1843, average earnings of employees have increased sixteen 
fold, or from four cents to sixty-four cents per hour. The trend of 
wages has followed substantially the general course of wages 
during this period. This trend has been gradually but steadily 
upward, interrupted at times by abnormal increases, which were 
followed by recessions. Thus, between 1870 and 1880 an 11 per 
cent wage reduction was put into effect; in 1921 there was a 
14 per cent reduction, and another reduction of 10 per cent in 1926. 
With the exception of the last, these reductions were subsequently 
more than regained. 

In 1926, average weekly earnings varied from $28 to $32 for all 
men employees, and from $18 to $24 for all women employees, the 
earnings at any particular time depending upon the proportion of 
full-time operation. Earnings are, of course, determined by length 
of time worked as well as by rate of pay. 

It was found that earnings of men employees reach a maximum 
at thirty years of age and hold this peak until the age of forty-five 
is reached. A slight decline in wages begins at the age of fifty, 
which is accelerated between the ages of fifty and sixty, and be¬ 
comes very marked after an employee reaches the age of sixty. 

Labor Turnover. It is a well-known fact that in all factories and 
mills there are too many workers discharged and others engaged in 
their places during a year. The percentage of those engaged per 
year in comparison to the total working force is called labor 
turnover. 

The records for several years of turnover reveal the fact that 
the excess of turnover for women employees over that for men 
amounts to from 50 per cent to 100 per cent per year. By nation¬ 
alities, turnover is greatest among Italians, with little difference 
between the sexes. A very low proportion of this total work¬ 
ing force is removed by discharge — not over 0.089 per cent 


262 ECONOMICS OF CLOTHING AND TEXTILES 


in the period 1922-1926, inclusive. The stability of married men 
employees exceeds that of single men and of both married and single 
women, as might be expected. As compared with married men, the 
turnover of single women is greater by 62 per cent, that of single men 
by 133 per cent, and that of married women by 255 per cent. 

Injury of Workers. Industry can also be made more efficient by 
preventing the maiming and destroying of human life. The most 
precious asset in industry is human labor. Every effort should 
be made to conserve physical and mental well-being by good working 
conditions, so that the worker's period of usefulness and happiness 
to his family may be as long as possible. Accidents and their pre¬ 
vention are causing grave concern in American industries today, 
and unprecedented efforts are being made to prevent them. 

According to a United States Government report made a few 
years ago of the 4,000,000 persons employed throughout the 
United States, some 2,500,000 meet every year with more or 
less serious injuries. As a result of these accidents, a total of 
227,000,000 working days were lost in a year. If the average 
pay of $4.50 a day be multiplied by this total, it will be seen that 
the loss in one year to wage-earners alone totals over $1,000,000,000. 
In other words, the lost time caused by accidents in a year is 
equivalent to the amount of time lost by over 750,000 men out of 
employment an entire year. 

To reduce the loss caused by accidents, many great industrial 
plants have organized elaborate campaigns of education and 
devised highly ingenious systems for safeguarding their employees. 

Recent Changes in Mill Design. While the original mill build¬ 
ing was a simple wooden structure built on the side of a stream, 
modern mill buildings and wearing apparel factories have developed 
into specialized structures adapted to their industrial requirements 
and to the welfare of the employees. The following changes have 
taken place in mill construction and equipment during the past 
generation. 

The design of textile plants has followed the development of 
power and transportation facilities, and has been greatly influenced 
by changing conditions in prices of raw material and labor. In the 
early days of the industry, when the serious question was to obtain 
power to drive the plants, and when labor was both cheap and 


BUSINESS ORGANIZATION 


263 


abundant, practically all of the mills were located on the streams 
where water power could be secured for direct mechanical trans¬ 
mission. In this stage of the art, a building with masonry walls and 
timber-joisted floors was the almost universal type. 

The improvement of the Corliss engine and the development of 
transportation changed the industry from one using practically 
all water-power plants; and for a number of years, beginning with 
the early ’eighties, a large number of the new plants were driven by 
steam. The increasing use of steam also tended to distribute the 
textile industry over a wider territory. With the introduction 
of the slow-burning type of construction, which consisted of 
masonry walls, generally brick, and heavy timbers carrying heavy 
plant floors, there came a standardized type of building that 
remained unchanged for many years. 

With the last decade the constantly increasing price of brick and 
timber, together with the growing scarcity of the latter, has forced 
the industry to look for other materials, and within the last few 
years there has been a large increase in the amount of reenforced 
concrete used for mill buildings. 

When labor and machinery could both be obtained at very low 
prices, there was no urgent economic necessity for securing high 
production per unit, either of labor or spindle, but with the rapid 
increase in prices during the last few years the situation has 
radically changed, and every manufacturer now bends his energies 
toward securing the highest efficiency from his plant, as well as 
toward reducing its depreciation by removing preventable causes of 
rapid wear, such as excess vibration and friction due to improper 
alignment. 

In today’s market for labor and materials, the reenforced concrete 
buildings cost practically no more than the ordinary type of slow- 
burning construction, with the advantage wholly in favor of the 
concrete, both in the matter of light and stability. More recent 
designs are of the flat slab type, which gives a room without beams 
and with about half the usual number of columns. This type of 
building, if used with steel sash and doors, is almost ideal for 
cotton manufacturing, in that it gives an unyielding floor for 
machinery, with an abundance of light. It can be built quickly, 
and in a great majority of cases the bulk of the material is available 


264 ECONOMICS OF CLOTHING AND TEXTILES 


near the site, especially the heavy materials such as stone and 
sand. 

Too much importance can hardly be laid on the necessity of a 
firm and unyielding floor for textile machinery. Every manufac¬ 
turer knows how impossible it is to keep machines in line on a 
regular timber floor, and even if frequent leveling is done, it is 
always at the expense of the life of the machine, for every time the 
alignment is changed the bearings are worn in a new spot. Recent 
tests have shown that with the reenforced concrete floors there is 
practically no need for realignment during the life of a machine, pro¬ 
vided it is properly set in the beginning. This one feature, in ad¬ 
dition to the greater steadiness, would make the reenforced concrete 
type of building worth while, even with a large difference in cost. 

A large percentage of the machines in existing mills are (and 
most of those built in the future will be) driven almost entirely 
by individual motors, which make it easy to change the location 
of machinery at any time. The use of individual drive on textile 
machinery is no longer an experiment, but it still has some oppo¬ 
nents, especially among those who have not used it. It is very 
doubtful if any manufacturer who has ever had his mill properly 
and thoroughly equipped with individual motors could ever be 
induced to depart from that arrangement, and the number of those 
who strongly favor it is rapidly increasing. No form of belt 
transmission yet devised will give constant and uniform speed, 
even if it receives a great deal of attention, which is rarely the 
case in a textile plant of any size. It is not infrequent to find 
mechanically driven spinning rooms where the average speed is 
10 per cent below the figured speed. This, of course, means an 
equivalent loss of production, as well as uneven running work, 
since any class of textile machine will give better results if run at 
constant speed. This is especially true of looms, since no loom 
will function properly with varying speed. 

The development and improvement of the silent chain has made 
it possible to apply the individual motor to nearly every type of 
cotton mill machinery, and where the application is properly made 
the resulting increase in production will always prove profitable. 

In the handling of cotton through a mill there has been a con¬ 
stant need felt for some form of conveying apparatus that would 


BUSINESS ORGANIZATION 265 

reduce the cost of transportation, and many schemes of this 
character have been tried and most of them found wanting. 

A great deal of improvement has been made in the handling of 
raw cotton from the warehouse to the picker room by using outside 
opening rooms of capacity sufficient to open and thoroughly age the 
cotton before it is taken into the mill. Some of the more recently 
built opening rooms have bins sufficient to hold several days’ storage 
of cotton. After being allowed to age, the cotton is taken into the 
mill through a conveyor pipe and distributed to the hoppers of the 
breakers or openers by means of automatic distributors. 

From this point, many forms of lap conveyors have been tried 
but few have been successful, partly because the distribution was 
to a large number of machines and not to one common point, and 
partly because the laps were frequently damaged. In designing 
and conveying system in a mill, it must be borne in mind that, 
unlike in many other forms of distribution, there is no single point 
of origin or of destination, and without an extremely complicated 
system the chances are that the total amount of handling will be 
fully as great with the system as it would be without it. 

Often the necessity for any handling system can be done away 
with by arranging the machinery in such a way that the length of 
the haul is reduced to a minimum. This, of course, is a matter in 
which no general rule can be laid down, and each case must be 
settled for itself, but frequently an intricate system makes an 
appeal to the manufacturer just because of its complication, when a 
careful analysis would show that the amount of labor saved would 
not warrant the expense involved. 

One of the most valuable improvements in mill equipment during 
recent years has been the use of automatic regulation in connection 
with humidifying apparatus. Formerly, very little attention was 
paid to the necessity of having an absolute uniform moisture at all 
times, and, of course, without automatic regulation this is not 
possible. But since the regulators have now been developed to 
a high point of efficiency, there is practically no excuse for a modern 
mill not to be properly equipped. This installation can be made 
in any mill, whether new or old. 

There are a number of cases on record where mills have reduced 
the weight of their picker laps by 5 per cent and still maintained the 


266 ECONOMICS OF CLOTHING AND TEXTILES 


correct weight of their output. This does not mean that they have 
added to the normal moisture in the cotton as it came from the 
warehouse, but that they have reduced the loss of this moisture 
from evaporation and have maintained in the cloth room approxi¬ 
mately the natural moisture that was in the cotton when it came 
from the bale. This not only saves a big loss in weight, but also 
makes better running work, which in these days of high-priced labor 
is of tremendous consequence. 

A properly designed mill, with abundant light, firm foundation 
for machinery, and the proper drive to insure uniform speeds, will 
secure an increased production without the use of additional labor, 
and is unquestionably worth a great deal more money than a mill 
of the usual type. In the long run it will prove to be a very much 
better investment even at its increased cost. 

American Methods of Manufacture. Specialization in the 
processes of production is distinctly American and has brought 
many blessings to the country. It has also brought about many 
social and economic conditions that have threatened the prosperity 
of the country. These problems will be gradually solved, but they 
must be solved not only according to economic principles but 
also for the best interest of society. Some results of this speciali¬ 
zation are as follows: 

1. The production of goods has been increased in some cases 
far beyond consumption, as in the case of cotton fabrics in the 
period 1930-1932. 

2. The cost of production per unit is lower, thus allowing more 
people to use a variety of goods. 

3. There has developed a greater variety of commodity, such as 
a variety of cotton fabrics to meet our wishes. But an abundance 
of styles may mean overproduction of certain kinds, which means 
that they may have to be sold below cost. 

4. Commodities are produced in a continuous stream, so that 
there is an ample supply. But in a depression, the plant-capi¬ 
tal goods may not be utilized to full capacity and hence will not 
create the maximum wealth. 

The development of large-scale production has also brought 
problems of (a) unemployment due to the rapid development of 
automatic machinery, (6) constant friction between the business 


BUSINESS ORGANIZATION 


267 


man and labor over working conditions and wages, (c) overpro¬ 
duction, (d) uneven distribution of business prosperity, resulting in 
cycles of prosperity and depression. 

Comparison of Foreign and Domestic Organization. Textile 
mills or factories in Europe are not organized on such a large scale. 
Each subdivision, such as spinning, weaving, or finishing, con¬ 
stitutes a separate mill. There are certain advantages and dis¬ 
advantages in both American and European organization. For 
example, while the cost of production in a large American mill is 
small, its productive capacity is so great that it must have large 
orders, such as 50,000 or 100,000 yards, etc. There are times 
when hand-to-mouth buying prevails, which means that small 
orders are frequently given every month. A small mill can 
execute small orders more economically than can a large mill. 
On the other hand, the cost of production is usually greater in a 
small mill than in a large one. 

We must bear in mind that production or manufacture on a 
large scale means standardization, or a uniform product. Most 
textiles and clothing in this country can be standardized and 
made on a factory basis. In Europe, there is a tendency for each 
country to have its own standards, and without a wide market it 
is not possible to standardize to the same extent as in this country. 
Even in America there are certain qualities of high-grade fabrics 
and costumes that must be manufactured on a small scale. 

However, there are also certain advantages in the smaller unit 
organization that exists in foreign countries: (a) they can secure 
small orders to advantage during the hand-to-mouth buying; 

( b ) small units retain a close relation between employees and 
employers and pleasant relations between buyer and seller; and 

(c) a number of small units may successfully combine the advan¬ 
tages of the large unit. 

German Shoe Manufacturing. The German shoe manufacturers 
say that they can not follow the American practice of manufac¬ 
turing only one shoe product. They are obliged to collect their 
trade from almost every country except America. It comes in 
small orders, and they have to accommodate themselves to many 
whims and make patterns and styles for every district of Europe. 
This increases not only the cost of production but, perhaps to a 


268 ECONOMICS OF CLOTHING AND TEXTILES 


greater extent, that of marketing. In the German shoe shops, 
moreover, the old conditions of apprenticeship still hold, hampering 
the change from hand to machine processes and preventing a large 
output. 

The average American thinks that the success of German in¬ 
dustry is due to low wages and long hours of work. This is not 
true, for if labor is cheaper there, coal is dear, machinery is dearer, 
and imported raw material pays a tax. The industrial supremacy 
of Germany is the result of definite and deliberate political action. 
Thirty years ago the German statesmen realized that the nation 
was inferior to America and England in natural resources and 
natural ingenuity; this inferiority forced upon their attention the 
value of thrift and of education. Thrift produced capital, and 
education produced industrial efficiency. 

America and England have served Germany as models of shop 
organization and equipment. They have imported American and 
English machines and tools; . they have engaged the best men 
from the best shops of these two countries, and have copied their 
methods of work and organization. Besides this they have 
devoted special attention to a matter that America has ignored to 
a great extent — the scientific or technical education of their 
people. 

Liberty in Business. At the beginning of our modern industrial 
system, about the time of the French Revolution, a spirit of 
democracy and liberty existed in almost every realm of activity. 
It was natural that business enterprise should be imbued with the 
same feeling, and that individuals should be permitted to produce 
and consume at will, without restriction from government. The 
argument for free trade was based upon the theory that all trades 
and occupations should be opened wide to all the people of a 
nation, in order that each one might choose the vocation for which 
he is best adapted. This principle of free enterprise naturally 
produced competition among business men, and was felt to be one 
of the surest methods of protecting the interests of the consumer 
and the general welfare of society. 

The relation of the government to business and industry has been 
a long-debated question, out of which have developed two distinct 
policies: (a) mercantilism or paternalism and (6) laissez-faire. 


BUSINESS ORGANIZATION 


269 


The history of industry shows that the government has always 
had more or less influence on it. The guilds of the different cities 
were practically the government and regulated the quality and 
prices of goods. The mercantile system justifies the influence of 
the government in industry so as to increase the commercial and 
military power of a country. Hence after the disappearance of the 
guilds we find the government exercising considerable control of 
industry. 

The other policy was founded on the principle of democracy and 
liberty. Under a policy of laissez-faire the government will keep 
its hands off and rely on competition to regulate all problems of 
business and industry. 

Competition benefits society in general as follows : (a) by reduc¬ 
tion of prices; (6) through the struggle to obtain the most customers 
it causes competitors to render the best service; (c) the elimination 
of waste in production in order to give larger profits provides a 
higher standard of efficiency; (d) in order to attract the most 
customers the tendency is to improve products; and (e) competi¬ 
tion under vigorous leadership develops new undertakings and 
inventions. 

On the other hand, the struggle of competition sometimes causes: 
(a) attempts to adulterate or substitute inferior goods; ( b ) pro¬ 
duction of more goods than society can use; (c) employees are 
obliged to work for long hours at low wages, and in unsanitary 
places in order to make the cost of production low; (d) employ¬ 
ment of children and women with low wages and long hours; 
(e) unfair practices in order to secure advantage; (/) the use of 
competitive advertising, thus increasing the cost of the goods and 
not benefiting society in general. 

For the past fifty or one hundred years the effort of industry 
has been to maintain a supply that would be adequate to meet the 
demand. With the development of science and the advance of 
knowledge production has outstripped consumption, and the world 
is today facing for perhaps the first time a condition of overproduc¬ 
tion. Under the earlier conditions the necessary policy of govern¬ 
ment was to protect the consumer against exploitation through 
monopoly, unreasonable restraints of competition, and price con¬ 
dition made possible by the shortage of production. 


270 ECONOMICS OF CLOTHING AND TEXTILES 


Statutes such as anti-trust laws prevent producers and manu¬ 
facturers from protecting themselves against the evil effects of 
overproduction. As the result of overproduction of the factory 
system there has been a depression about once in ten years during 
the last fifty years. Business men during each depression have 
realized the evils of overproduction and have repeatedly asked the 
government to grant business the privilege of regulating itself by 
controlling production and eliminating poor business practices, 
price cutting, etc. But after the depression the enthusiasm for 
better business stability disappears, and there is no definite de¬ 
mand for modifying existing laws with regard to trade practices, 
price regulation, etc. 

The depression of 1930-1933 brought much unemployment, 
poverty, and distress, particularly in the large manufacturing, 
industrial, and agricultural districts. 

These hardships may be explained by the fact that people living 
under primitive or old-fashioned conditions work harder and natu¬ 
rally have a lower standard of living than the industrial workers. 
Then again the thrift that they are obliged to practice has developed 
economies and methods of securing the necessities of life that the 
industrial worker feels are beneath him. 

The factory system has provided us with machines that multiply 
our power many times and produce more with less work and less 
cost than ever before. Nevertheless, with all our facilities and 
excess of every kind we have depression and people starving while 
there is a surplus of food, clothing, etc. 

The reason for this condition is due to the fact that the masses 
of workers have not been able to buy the clothing, etc. that they 
have produced. They could not pay the price. Industry has 
not been able to furnish clothing and other commodities at a price 
that the masses can pay. The result is that goods have accumu¬ 
lated, due to overproduction, and factories and industries have 
been obliged to close down. The working group are necessarily 
employed on part time or no time, earning less wages. The 
buying power of any country or community comes chiefly from 
the wages of the working classes. Hence, in order to bring com¬ 
modities within the reach of all it is necessary to reduce the price 
through elimination of waste or to increase wages and shorten the 


BUSINESS ORGANIZATION 271 

work week so the work may be spread over the greatest number of 
men. 

In the summer of 1933 Congress gave the President unlimited 
powers to deal with the problems of the depression. The President 
proposed a National Recovery Act, which was a nation-wide plan to 
(a) raise wages, ( b ) create employment, (c) increase the purchas¬ 
ing power of the wage-earners, and (d) restore business activity. 
The President asked employers and the public to enter into an 
agreement. Each employer signed the following certificate of 
compliance with the National Recovery Act, and gave it to the 
local postmaster, who gave to the employer a “ blue eagle ” poster 
to place in his establishment to notify the public that he had 
agreed to the terms of the Recovery Act. He could then put the 
“ blue eagle ” on the merchandise that he produced. 

The agreement or code contained the following specifications: 

Hours of Work 

A. Workers in factories or mechanical workers or artisans. 

1. Thirty-five hours a week until Dec. 31, 1933. 

2. May be employed 40 hours a week for not more than six weeks between 
Aug. 31, 1933 and Dec. 31, 1933. 

3. Not more than eight hours in any one day. 

4. Agreement does not apply to those employed on: 

a. Emergency, maintenance or repair work. 

b. Highly skilled workers on continuous processes would reduce production. 

5. Does not apply to employees in managerial or authoritative capacity 
receiving more than $35 a week. 

B. Clerical and Service Employees: 

1. Forty hours a week until Dec. 31, 1933. 

2. Not more than eight hours per day. 

3. Employers not to reduce hours store or service is open for business below 
52 hours per week unless: 

a. Hours were less than 52 on July 1, 1933. 

b. If so, no further reduction permitted. 

4. Hour limitations do not apply to: 

a. Establishments employing not more than two persons in a town of less 
than 2500 population, unless town is part of a larger trading area. 

6. Outside salesmen. 

c. Registered pharmacists and other professional persons. 

d. Employees in a managerial or authoritative capacity receiving more 
than $35 a week. 

Concerning Wages 

A. Workers in factory or mechanical workers or artisans. 

1. Minimum of 40 cents an hour unless rate was less than 40 cents an hour 
previous to July 15, 1929. 

2. No one to receive less than 30 cents an hour under any condition. 

3. Above rates apply whether worker is on a time rate or piece rate. 


272 


ECONOMICS OF CLOTHING AND TEXTILES 


Accounting Employees 

B. Accounting, banking, clerical, office or sales (except outside salespeople) 
in any store, office, department public utility, or any automotive or horse-drawn 
passenger, express, delivery or freight service or in any other place or manner. 

1. $15 a week minimum — in cities over 500,000 population. 

2. $14.50 a week minimum — in cities between 500,000 and 250,000. 

3. $14 a week minimum — in cities between 250,000 and 2500. 

4. 20 per cent increase a week in all towns below 2500, if this increase is not 
in excess of $12 a week. 

C. Employees now earning more than minimum. 

1. No (hourly) wage reductions — even though working hours are reduced. 

2. Employers agree to increase pay of these people by an equitable read¬ 
justment of all pay schedules. 

Wage Groups Classified 

Preliminary classification of wage groups: 

A. Workers in factory — 35-hour classification. Factory or mechanical 
workers or artisans. 

B. Clerical — 40-hour classification includes clerical, service and retail 
groups such as: Barbers, beauty parlor operators, dishwashers, drivers, 
delivery men, elevator operators, janitors, porters, watchmen, restaurant 
workers, filling station operators, maintenance force, including charwomen, 
window washers, etc. 

C. Groups not covered by code: 

1. Professional occupations. 

2. Employees of federal, State and local governments and other public 
institutions and agencies. 

3. Agricultural labor. 

4. Domestic servants. 

5. Persons buying goods and selling them independently. 

Data on Child Labor 

1. No person under 16 years of age shall be employed after Aug. 31, 1933. 

2. Persons between ages of 14 and 16 (not in mechanical or manufacturing 
industries) for not more than 3 hours a day between 7 a.m. and 7 p.m. — these 
hours of employment not to interfere with hours of day schools. 

How Prices May Be Increased 

A. Prices may be increased to cover: 

1. Increased cost of production and distribution. 

2. Other costs and taxes resulting from recent legislation. 

3. Cost as of July 1, 1933, can be taken as base for any price increase. 

4. No one shall make a Profit on the Increase in price. 

B. No price increase on any merchandise sold after July 1, 1933, by more 
than is necessary to cover above actual cost. 

C. No profiteering. 

D. Before boosting prices, all sellers must give full weight to probable 
increases in sales volume. 


Subject to Contracts 

A. Burden of price increase on the buyer. 

1. Where before July 16, 1933, purchasers contracted for goods at a fixed 
price for delivery during the period of the President’s agreement (Aug. 31, 1933 
— Dec. 31, 1933). 


BUSINESS ORGANIZATION 


273 


He, the purchaser, shall make appropriate adjustment of said fixed price 
to meet any increase in cost due to the seller having signed the President’s 
agreement or the seller having been bound by Code. 

Code Supersedes Agreement 

A. Any accepted industrial code supersedes the President’s agreement. 

B. All industrial codes must be submitted before Sept. 1, 1933. 

_ C- Every employer must be classified and under the jurisdiction of either 
the blanket code ( i.e the President’s agreement) or of an industrial code on 
or before Sept. 1, 1933. 

Certain Exceptions Made 

A. In cases where certain features of the President’s agreement (blanket 
code) make it impossible to carry it into practical and full effect: 

1. Make petition to your trade association, or chamber of commerce, for a 
stay of such provision, pending investigation by NRA: 

a. Provided agreement is made by applicant to abide by decision of investi¬ 
gators. 

b. Written approval of such a stay by the trade association will be accepted 
by NRA temporarily. 

2. Send the petition and the approval of the trade association to NRA in 
Washington, and, 

3. Send your signed copy of the President’s agreement to district office of 
the Department of Commerce. 

4. Adjust the hours of labor and the wages of your employees in accordance 
with your agreement. 

5. Sign the Certificate of Compliance with the following endorsement: 

“Except for those interim provisions regarding wages and hours which have 
been approved by the-Trade Association.” 

6. Deliver (personally) Certificate of Compliance to your local postmaster 
and receive Blue Eagle. 


CERTIFICATE OF COMPLIANCE 
I/We certify that we have adjusted the hours of labor and the wages of our 
employees to accord with the President’s re-employment agreement which 
we have signed. 


(Name) 


(Street) (Firm name) 


(Town or city) (State) (Industry or trade) 

Do Not Mail — Deliver to Postoffice 
on or after Aug. 1 and receive insignia of membership 


Instructions 


B. In cases where a specific code has been submitted by your industry with 
wage and hour provisions varying from the President’s agreement and where 
these variations have been accepted by a NRA deputy administrator: 

1. Sign the President’s re-employment agreement. 

2. Mail it to district office of Department of Commerce. 











'"IPs- r 


274 ECONOMICS OF CLOTHING AND TEXTILES 

3. Comply with its provisions as far as possible. 

4. Sign the Certificate of Compliance with this endorsement: 

“To the extent of NRA consent as announced, we have complied with the 

President’s agreement by conforming with the substituted provisions of the 
code submitted for the-trade or industry.” 

5. Present Certificate of Compliance to your local postmaster, who will 
post your name on the honor roll and deliver the NRA Blue Eagle. 

Sundays Legal Holidays 

You are to proceed on basis on which you have submitted your signed 
agreement. 

All overtime to be paid at rate of 1£. . 

All employees in foods trade (retail and wholesale) are authorized to work 
48 hours a week (except outside salesmen and delivery men). 

All Sundays are considered legal holidays for purposes of retail trade. 

A. Who owns the NRA insignia? 

1. It is the sole property of the United States government. 

2. It may not be used or reproduced without authority of the NRA. 

B. Where to get additional insignia ? 

1. From authorized printers. 

C. How to order insignia. 

1. Buyer must prove right to use insignia. 

2. Seller must prove right to reproduce insignia. 

3. Official (1£ inch) seal must appear on each order for insignia. Get this 
seal from your loc^l postoffice. 

How Women Can Help 

What can a woman do to make this plan a success ? 

1. Sign the consumer statement of co-operation. 

2. Take this postcard to your local Chamber of Commerce. 

3. Get a consumer’s seal which you place in the window of your home. 

4. Live up to agreement by supporting and patronizing employers and 
workers who are members of NRA. 

5. Get your friends to co-operate also. 

6. Have faith that the prosperity of the U. S. A. — your husband’s job 
depends upon united effort in this common cause — remember 

“United We Stand — Divided We Fall.” 

Benefits under Agreement 

A. More jobs created — reduces unemployment — spreads employment. 

B. More money in wage earners’ pockets (larger total wages). 

C. Increased purchasing power: 

1. 1,000,000 men put back to work now at $15 a week means $15,000,000 
a week increase in purchasing power. 

2. A family of four, earning $5 each a week, earns $20. Under NRA wage 
requirements this family now earns $60 a week or more. 

D. Eliminates child labor. 

E. Eliminates sweat shop working conditions and wages. 

F. Sets up mechanism for policing industry by itself (NIRA). 

1. Each industry eliminates its own unfair competitive practices. 

2. Each industry substitutes trade co-operation in place of uncontrolled 
individual competition. 

G. Increases opportunity for long range economic planning by industries. 

H. Gives peace of mind and greater sense of security to all workers. 


BUSINESS ORGANIZATION 


275 


The cotton textile industry submitted the first code, and it was 
approved by the President. This industry is notorious for the 
practices which the law was designed to rectify — long hours of 
employment, low pay for its workers, and ruthless methods of 
competition. Representatives of the industry, labor, and the 
government sat down in public and in a few days worked out their 
differences, agreeing to increase minimum wages to the purchasing 
power level of 1926, reduction in hours of labor to two shifts of 
forty hours a week, checking overproduction, and the abolition 
of child labor. As President Roosevelt said: “After years of 
fruitless effort and discussion, this ancient atrocity went out in a 
day, because this law permits employers to do by agreement that 
which none of them could do separately and live in competition.” 

However, the forty-hour week or the minimum wages established 
by the textile code should not be accepted as a precedent by other 
industries. Such a work'week and such wages generally would not 
scratch the surface of our task of putting large numbers of men 
back to work and restoring consuming power. Under the present 
conditions an average work week of thirty-two hours with a mini¬ 
mum wage of 45 cents an hour for the lowest paid type of workers 
would perhaps accomplish this purpose. But it would be absurd 
to fix an inflexible schedule for all industry. 

While the President allowed trade organizations to submit codes, 
if it so happened that difficulties within an industry made it 
seem impossible or tended to delay unreasonably the presentation 
of its code, the law empowered the Recovery Administration to hold 
hearings and enforce a code for such an industry on its own motion. 
This crisis demanded action. 

There were bound to be some recalcitrants, those who were 
unable to see or were stubbornly unwilling to see that our economic 
system is undergoing a rapid change, and a change that is necessary 
if the nation is to be preserved. There were some who refused to 
cooperate in this program and took refuge in their Constitutional 
rights. Some industries doing a strictly State business expected 
to do that, and while the law gives the Administration power to 
control all industry “in or affecting interstate and foreign com¬ 
merce/’ in all probability the courts will determine this issue. 
The President depended for the success of this recovery program 


276 ECONOMICS OF CLOTHING AND TEXTILES 


on a force greater than the law — a force more powerful than any¬ 
thing else — public opinion. 

Trade Organizations. When a trade association is managed 
with intelligence, and has experience and sufficient funds, it can 
do an extraordinary number of things that should be done by an 
industry and not by the government. 

Freedom for healthful competition walks arm in arm with 
mutual aid in the ideal trade organization. Is there need for a 
study of new markets for cotton? Are data wanted on employ¬ 
ment conditions in a certain trade? These tasks and countless 
others are undertaken by associations. They usually are costly 
jobs, but if a trade body is wisely directed it never undertakes 
more work than it can handle. When an association drains its 
own funds and calls on some bureau in Washington for aid in work 
to be done for its industry, it marks a sad day for the cause of in¬ 
dividualism. It costs real money for an industry to support its 
own cooperative services, but in the long run it is safer and healthier 
than the practice of keeping one hand on the apron strings of a 
Federal bureau. 

Trade organizations when established in the spirit of meeting 
the needs of society and attempting cooperation between manu¬ 
facturer, worker, salespeople, and consumer can do much to develop 
prosperity. 


QUESTIONS 

1. Why is the textile industry considered important? 

2. What factors enter into production? 

3. What responsibility does the entrepreneur assume? 

4. From the ownership viewpoint, how may business organizations 
be classified ? 

5. List ten typical individual business organizations that you know. 

6. How does a high import tariff on spinning machinery affect a cotton 
farmer? 

7. How would a world-wide overproduction of wheat affect a wool 
raiser? 

8. If you advocate Federal aid for the farmer, what form would you 
advise? 

9. In what way does a farmer’s financial problem differ from that of 
other business men? 


BUSINESS ORGANIZATION 


277 


10. What are the responsibilities and advantages of operating your 
own business ? 

11 . How does a partnership differ from an individual enterprise? 

12. What distinguishes a corporation from a partnership? 

13 . In a very successful business, who usually receives The greater 
return on his investment, the bondholder, preferred stock holder, or 
common stock holder? 

14 . In an established business, which of the above offers the greatest 
degree of safety of principal invested ? 

15 . What are some of the functions of farmers’ cooperative agencies? 

16 . How do consumer’s goods differ from capital goods? 

17 . Considering the manufacture of a gingham apron, trace its primary 
and secondary factors of production. 

18 . Why may we expect the southern states to surpass New England 
in cotton goods manufacture ? 

19 . What are some of the factors in a location that contribute to the 
success of a particular industrial site ? 

20. Why do industrial centers shift from time to time ? 

21. Distinguish between fixed and circulating capital. 

22. What is meant by depreciation; how is the amount calculated? 

23 . What factors govern the success of a manufacturing enterprise? 

24 . What factors determine the amount of loanable capital in any 
community ? 

25 . What personal qualities contribute to success in the textile field? 

26 . Describe the responsibilities of the business man. 

27 . Explain the operation of the law of diminishing returns in the 
case of advertising a sale of cotton dresses. 

28 . In what way may a marginal producer be considered a menace to 
a particular industry? 

29 . How may the sale of a by-product affect the sale of the main 
article ? 

30 . Why is organization important in the textile business? 

31 . How do American and European mills differ in organization? 

32 . What are the chief rewards of the true entrepreneur? 

33. What advantages in management does a large plant offer over a 
smaller one ? 

34. Prepare the organization chart of a local industrial plant. 

35. Compare the steps in manufacturing shoes with those in producing 
a garment. 

36 . How does the present-day production of clothing differ from the 
method used 100 years ago ? 


278 ECONOMICS OF CLOTHING AND TEXTILES 


37. What materials enter into the production of modern men’s gar¬ 
ments? 

38. Distinguish between a custom-made and a readymade garment. 

39. What arguments can you advance in favor of large-scale mass 
production'? 

40. What advantages does a smaller mill offer? 

41. Briefly outline the work of the industrial relations department in 
a woolen plant. 

42. What factors have contributed toward increasing wages and de¬ 
creasing hours of labor during the last century ? 

43. What are some causes of high labor turn-over? 

44. Why is accident prevention in industry important? 

45. What advantage does a concrete building offer to a textile manu¬ 
facturer ? 

46. In laying out a cotton mill, what physical and mechanical factors 
must be considered? 

47. How can an industry overcome the disadvantages of both a 
laissez-faire and a mercantilism policy of government supervision? 


CHAPTER VII 


BUYING AND SELLING 

Importance of Marketing. The average person may be inclined 
to minimize the marketing function in the clothing industry, but 
it is actually one of the most important branches of production. 
It is only through the process of trading or exchange that goods 
are transferred from the primary producers, such as growers, mill 
owners, manufacturers, etc., to the hands of the various middlemen 
and finally to the consumer. Raw materials, finished cloth, 
costumes, etc., must all go through this process of exchange before 
they are in the hands of the people who use them. 

Exchange. We have defined the term exchange as the transac¬ 
tion of parting with a commodity in return for something else 
regarded as the equivalent in value. This method of exchanging 
one commodity directly for another of equivalent value was the 
first method of doing business and was called barter. Later this 
method was improved by the introduction of a common medium 
of exchange — such as gold or silver coins and the value of com¬ 
modities began to be measured in the terms of money. Today, 
all buying and selling is done in terms of money, and the exchange 
value or price is quoted in terms of money instead of in terms of 
equivalent values of other commodities. 

Marketing, or the circulation of products to the consumer, 
existed back in the domestic and guild periods, but it was not 
until the beginning of the factory period that trading became an 
important force in society. With the beginning of specialization 
in industry each person produced only a small part of the things 
required to meet his various needs, and relied for the satisfaction 
of his other wants upon being able to exchange his surplus product 
for the surplus products of others. Thus, if a man made knitting 
needles, he would exchange these needles for food, clothing, etc. 
During the early industrial development marketing was done 


280 ECONOMICS OF CLOTHING AND TEXTILES 


directly by the producer, but with increasing production and the 
subdivision of labor under the factory system there came the 
need for extensive markets and for a special body of traders to 
carry on the process of exchange. 

Merchants and Middlemen. A trader or merchant is one who 
is engaged in the business of buying commercial commodities and 
selling them again for profit; especially, one who buys and sells 
in quantity, either by wholesale or retail. One who buys without 
selling again, or who sells without having bought, — as where one 
sells the products of his labor, — who buys and sells exclusively 
articles not the subjects of ordinary commerce, or one who buys 
and sells commercial articles on salary and not for profit, is not 
usually termed a merchant. Those who buy and sell on a com¬ 
mission for others are termed commission merchants. A merchant 
tailor is a tailor who furnishes the materials for the clothes that 
he makes. 

We discussed in a previous chapter the appearance of early mer¬ 
chants who relieved textile manufacturers of the responsibility of 
seeking customers for their product. This was the beginning of a 
professional body of traders or middlemen. It is true that the 
methods of these early traders were very crude. Goods were some¬ 
times carried on the back of the trader or that of his horse and 
were peddled from house to house or farm to farm. Of course, 
with such a method he could not cover much ground, and we 
find the natural result — the opening of a store or central trading 
point. 

In the early development of the textile industry in the United 
States there were no middlemen or professional traders, and the 
mills were obliged to find their own market. Accordingly, the 
cloth was sold through the mill store directly to the neighbors in 
the surrounding country. Some of the mill owners found this 
method of marketing their goods inadequate and the local market 
too small. Accordingly they went to stores in the near-by cities 
and tried to induce them to sell the mill fabrics. Previous to this 
time most of the fabrics carried by the stores were the popular 
imported textiles. One store agreed to handle mill products and 
turned them over to an auctioneer to sell. Heavy sheetings were 
sold at thirty cents a yard, when the owners would have been 


BUYING AND SELLING 


281 


satisfied with twenty-five cents. This was the beginning of the 
first selling agent. 

Eventually, in 1809, the products of the mills were sold through 
stores in Boston, New York, Philadelphia, and Baltimore. These 
stores sold the textiles on commission and later became known as 
the first commission houses. 

Function of the Middlemen. According to the economic defini¬ 
tion of production, goods are in the process of production until 
they are in the hands of the ultimate consumer. In other words, 
all the agencies that handle a commodity, such as cotton sheeting, 
during its progress from the primary producer to the buyer who 
actually puts it into use are called producing agencies. 

It is true that in the business world they are generally spoken 
of as distributing agencies, but since they do not, strictly speaking, 
transport or distribute the commodities, the term distribution is 
not a correct one to describe their function. Marketing or ex¬ 
change is a more appropriate term, and the agencies conducting 
the marketing are more correctly called middlemen or traders. 

While the middleman, merchant, or tradesman does not directly 
produce concrete commodities such as clothing and other wearing 
apparel, he does add to its utility by causing a change in its form 
and location, so as to make it more accessible to the consumer. 
To illustrate: He buys shoes in large quantities; that is, in case 
lots. He buys many cases, each containing shoes of a different 
size and style. He places them in a conspicuous place in a store, 
where the consumer may see them, try them on, and examine dif¬ 
ferent styles. While the consumer is doing this, he has the facilities 
for sitting in a restful position and can satisfy his desires at leisure. 
If he does not see what he wants, he can leave the store without 
charge for services. 

In the same way the middlemen give additional value to worsted 
or woolen fabrics by taking large lots from the mill and separating 
them into smaller lots — single bolts — exposing them for exami¬ 
nation by the consumer on a table in a tailoring shop. 

The middlemen or traders are the life of business in our modern 
world. They, above all others, have been responsible for the 
development of our complex industrial system, the subdivision of 
labor, specialization of clothing and other commodities. They 


282 ECONOMICS OF CLOTHING AND TEXTILES 


interpret the desires and needs of the consumers and determine 
to a great extent the kind and variety of goods sold. The activities 
of the trader have stimulated the development of all forms of com¬ 
munication, such as the telephone and the telegraph, and all means 
of transportation — motor buses, railways, steamships, etc. 
Through the services and judgments of the traders in the market 
we have the basis for the price standards that prevail for various 
commodities. The middlemen also help to finance the production 
of commodities during the period before they are sold to the in¬ 
dividual consumers. 

Types of Middlemen. An analysis of the field of exchange in 
the textile industry shows that the middlemen play a very impor¬ 
tant part. For example, textiles may pass through the hands of 
the following agencies before reaching the ultimate consumer: the 
manufacturer, broker, commission house, jobber, wholesaler, and 
retailer. It is, of course, possible to eliminate some, but not all, 
of these middlemen. To reach the consumer some form of retail¬ 
ing is necessary. This is true even if the producer sells directly 
to the consumer, since in such circumstances the manufacturer 
himself becomes a retailer. 

Selling Agents. The selling house or selling agent arose from 
the great demand on the part of mills for capital to cover the cost 
of materials in process, and of finished goods unsold, and for the 
extension of the necessary credit to customers. During the early 
part of the 19th century this capital was obtained from mer¬ 
chants, who had heretofore invested their capital in an import 
and export business. Because they had invested their capital in 
the mills, they were naturally interested in the disposal of the 
finished product and become the selling agents of the mills. The 
selling agent received interest on the capital advanced and com¬ 
mission on the sales of the product. Later the selling agent pre¬ 
pared the designs for the fabrics and charged a commission of 
H per cent on sales. In this case the work of gathering style 
information is done by an expert, called a styler, who makes 
fabric designs, which are worked out as follows: Designs with 
specifications are sent to the mill which makes up samples called 
“blankets” and submits its estimate of the price at which the 
goods can be delivered. The designs are incorporated into the 


BUYING AND SELLING 


283 



season’s lines and the selling house sends out its salesmen with 
samples. 

Mill Selling Agent. Many large mills find that they can develop 
a more effective selling field by becoming their own merchandising 
and marketing agent. In this way, by direct selling through the 


Mill Sales Office 

Showing the selling of towels to buyers and store executives. 

mill agent, they can be sure that the price is sufficient to cover the 
cost of production. Also, many mills found that under the old 
method, with a separate selling agent, they were not getting all 
the business that might be secured from customers. Many were 
being sold only one or two of the company’s lines, when they 
could readily use three or four. It also became obvious that 
the company was not getting the largest amount of business 
possible in the territory in which it had no branch offices. The 
old, loose form of organization, characteristic of the textile industry, 
was not geared either for thorough merchandising or thorough 
marketing of goods. Therefore a new section was created in the 
mill, called a merchandising and marketing department. 












284 ECONOMICS OF CLOTHING AND TEXTILES 


The usual organization is as follows: First, a general merchandis¬ 
ing manager, to whom all the individual merchandising managers 
report, is appointed. Then a style director, who functions in an 
advisory staff position, is engaged. He brings in style ideas, lays 
out designs, goes over the designs with the merchandise managers, 
and helps them to make selections and style their lines. Following 
this, a sales promotion department is organized with a manager in 
charge. This department forms contacts and cooperates with 
both the merchandising phase of the business and with the general 
trade. An advertising department is an auxiliary of the sales 
promotion department. A general sales manager is appointed to 
centralize control and proper supervision over the activities of 
the sales force. 

Commission Merchant. The commission merchant is a middle¬ 
man who sells textiles in a certain district on a commission basis. 
He may be either an individual or a firm authorized to sell textiles 
under his own name or under the name of the foreign or domestic 
manufacturer whose product is handled. This agent is intrusted 
with the possession, management, control, and disposal of the 
goods to be sold. Sometimes mill owners and manufacturers find 
that it is to their advantage to have a controlling financial interest 
in the commission houses. 

Factor. We have seen above that commission houses not only 
sell merchandise for mills which they represent but finance these 
sales as well. But with the development of the textile industry 
the mills have become more or less their own selling agents, and 
wish to continue to be so. Hence the selling function of the com¬ 
mission house has gradually disappeared, and a new agency has 
arisen, called a factor. This agency deals with the financial side 
of the sales, and exercises only a general supervisory and coun¬ 
seling attitude in respect to selling policies. In other words, the 
factor assumes the purchase and the discount, on a notification 
basis, of receivables (paper) created out of sales by mills, converters, 
and importers in textile and related fields. In addition, but in a 
gradually decreasing number of instances, a factor may at seasonal 
periods advance money upon finished merchandise. Such mer¬ 
chandise security against which advances are made is consigned to 
and pledged to him, so that he has a valid lien thereon either by 


BUYING AND SELLING 


285 


actual possession or notice of lien filed pursuant to law, or both. 
Advances against merchandise evolve into accounts receivable when 
the goods are sold and shipped, so that the factor’s loans are not 
only secured but automatically repayable. 

Jobber. Selling agents usually exact very strict terms from the 
purchaser. Many dealers in textiles are unable to make quick 
payments, and consequently are willing to pay a higher price for 
textiles, provided they receive better terms of payment. Therefore, 
an agent called a jobber has arisen, who buys textiles in bulk from 
the mills and resells them to smaller dealers at a higher price, in 
smaller quantities, and with long-term payments. 

Broker. Textile manufacturers often authorize an agent to make 
a business transaction, such as a contract for raw material, unfin¬ 
ished cloth, etc. Thus, there are cotton brokers who purchase raw 
cotton for mills, and also cotton brokers who sell raw cotton for the 
farmer. The same practice applies to textiles, etc. The broker 
differs from a commission merchant in having less power. 

Converter. The term converter is applied to agents who pur¬ 
chase cloth (either cotton or silk) in the gray — that is, as it comes 
from the loom. This cloth is finished by the converter — that is, 
made white (bleached), printed, dyed, or otherwise finished, 
according to demands of customers or anticipated demands. 

Finishing is a trade term which in its broad sense comprehends 
all of the numerous processes and operations to which woven 
fabrics are subjected after leaving the loom. In the case of cotton 
goods, it includes tentering, stretching, calendering, lustering, 
watering, glazing, etc. \ in the case of silk, such operations as 
stiffening, drying, calendering, and lustering ; in woolens, perching, 
mending, burling, inspecting, scouring, fulling, shrinking, steaming, 
shearing, brushing, napping, pressing, measuring, folding, etc. 
The number and character of the finishing operations to which a 
fabric is subjected vary according to the use to which it is to be 
put and to the particular feature or features it is desired to empha¬ 
size. 

Wholesaler. The entire structure of marketing in this country 
depends on the wholesale function — namely, the buying of large 
lots of goods and breaking them up into smaller units, which 
can be actively merchandised through intelligent cooperation 


286 ECONOMICS OF CLOTHING AND TEXTILES 


with retail stores. The bulk of America’s manufactured products 
are disposed of in this manner. Many manufacturers who had 
departed from the fundamental methods during the era of pros¬ 
perity, and spent much in an experiment to eliminate the whole¬ 
saler, are now happy to return, poorer but wiser, to the first 
principles of marketing. The wholesaler receives his orders and 
demands from the retailer, who is in direct contact with the 
consumer. The wholesaler then transmits these orders to the 
producer. 

Of the three basic methods of distribution (house-to-house solici¬ 
tation, direct mail solicitation, and retail marketing), distribution 
through retailers is economically sound as well as the most practical 
of all known methods. It is impossible for manufacturers to 
maintain warehouses in widely scattered territories, and to render 
“on the spot” service to retailers. In other words, the wholesaler 
is a necessary link in the chain. But no manufacturer, operating 
his own warehouse or service, should attempt to distribute com¬ 
peting makes. Neither should he attempt to service several 
trading areas from one warehouse point. These functions are 
the wholesaler’s. But if the wholesaler is successfully to render his 
service, certain principles of operation must apply, such as: 

(а) The manufacturer should not sell to other wholesalers within 
the same trading area. 

(б) The wholesaler should not attempt to cover several trading 
areas from the same warehouse point. 

(c) The wholesaler should not attempt to sell any competing 
brands of the same commodity. 

(i d ) The manufacturer must have a price structure that will 
enable the wholesaler to sell to all classes of retailers, including 
department stores. 

Traveling Salesmen. Most distributors have introduced their 
merchandise in the different parts of the country by means of 
traveling salesmen. The “drummer,” as he used to be called, is 
a commercial traveler or solicitor, the agent or representative of 
a manufacturer, importer, or other wholesale dealer, who procures 
and transmits orders for the goods of his firm in quantity, by per¬ 
sonal solicitation and the exhibition of samples. A drummer is 
not a peddler, for he carries no goods for delivery, makes no 


BUYING AND SELLING 


287 


direct sales, and transacts business only with dealers, never with 
consumers. 

The cost of maintaining a traveling sales force is large, due to the 
expenses and salary of each member. This is the old method of 
direct selling. Can this means of distribution be eliminated? 
An investigation by the National Credit Office in 1927 shows that 
there are 95,000 small villages with populations of not over 500, 
now consuming 42 per cent of all cotton goods made in this country, 
and 3750 small towns with populations of 500 to 10,000 consuming 
16 per cent. This means that 99,000 villages and towns with 
populations of less than 10,000 use 58 per cent of all the cotton 
goods produced by our mills, and most of the 95,000 rural places can 
be reached only by salesmen traveling in automobiles, carrying 
samples of such goods as are generally wanted in rural communities. 

One of the methods of selling wearing apparel is by means of 
house-to-house canvassers, selling in direct competition with retail 
stores. Upward of 200 different articles are being sold by this 
method at the present time, including practically all of the staples 
dealt in by retail stores. The list stops only at the point where the 
initial payment required becomes so high as to discourage the 
housewife from buying. 

Resident Buyers; Group Buying. Group buying of clothing 
owes its existence to the rapid changes in styles of costumes. So 
rapid are the changes in style that selling style merchandise on the 
road is fast becoming a lost art. It is not always safe for a retail 
buyer to purchase apparel from a traveling salesman. Styles 
often change from month to month, and by the time the dresses 
are delivered they may be a month out of style. Then again, the 
cost of sending salesmen to call on individual stores is very great, 
while buying in large quantities by a single agency means a lower 
price for the retailer of a small store. This group buying is nor¬ 
mally carried on in the style center, New York City, by a resident 
buyer, who buys for many stores in the country, thus reducing 
the expenses of each store. 

As to the question of whether a local resident buyer is competent 
to select merchandise for sale in Ohio or Oregon, the manufacturer 
should remember that all sections of the country are linked by a 
similarity of taste which is growing more uniform every day. Any 


288 ECONOMICS OF CLOTHING AND TEXTILES 


successful retail buyer of style merchandise should be able to come 
to New York and buy for any other store in the country with suc¬ 
cess. The radio, movies, and style magazines have caused style 
information to be available in every part of the country, so that 
consumer demands are everywhere similar. 

Retail Stores. The final sale of textiles must naturally be in 
small units. Since most wholesalers tend to specialize, it is natural 
that there must be some agency that will bring together textiles of 
all kinds and dispose of them in small quantities. The retail dry 
goods store has undertaken this task. 

Dry Goods is a popular term in the United States for textile 
fabrics and related articles of merchandise, as, cloth, shawls, wraps, 
garments, blankets, carpets, ribbons, yarn, thread, upholstery, 
millinery, etc., in distinction from hardware, groceries, clothing, 
etc. In this sense the term is used in the United States exclusively, 
though the term is not, as is generally supposed, of American 
origin. The first recorded use of the term “dry goods” to describe 
textile fabrics collectively occurred in a report to the English 
House of Commons in 1745. In England, Scotland, Ireland, 
Canada, and all other English-speaking countries, “mercery” and 
“drapery” are the terms used to describe textile fabrics collec¬ 
tively. 

The dry goods store is found in every village and hamlet, and is 
a center of trade in all communities. In the larger towns and cities 
the dry goods interest forms one of the most important departments 
of business, and greatly helps in sustaining all other branches of 
trade. The consumption demand for dry goods increases in a 
ratio corresponding to the increase in population. A business of 
such magnitude, involving so much capital, and intimately inter¬ 
woven with the wants of our modern civilization, requires the best 
management possible. 

Department Store. A department store is a retail store in which 
the different lines of merchandise kept for sale are displayed in 
separate departments, and which, so far as local conditions permit, 
aims to supply all of the material wants of its possible customers. 
In the large establishments of this character a buyer and a force of 
salespeople are employed for each separate department, and the 
volume of business transacted, profits, losses, expenses, etc., of 






















































5T0C 


BOARD 


PF 


VICE il 

I 

CENER 


_ EXECl I 

GENEf ft 

STORE MANAGER i 
CONTROLLER 


FINANCIAL DIVISION 


CONTROLLER 


BQARPQF OPERATIONS 


STORE MANAGER 
ASSISTANT STORE MANAGERS 
PLANNING DIRECTOR 
PURCHASING DEPT: MANAGER 
CONTROLLER, Advisory Member 
GENERAL MANAGER, d Officio 


MANAGEMENT DIV 


STORE MANAGER 


PLANNII 

METH 


ST/1 
FIXTL 
EQUIPMEf 
BC 

GEN !'| 
PROD )l 


FINANCIAL 


CREDIT 


PURCHASE AUDIT 


SELLING 
SERVICE MGR. 


NON-SELLING 
SERVICE MGR. 


PERSONNEL 

MANAGER 


MAINTENANCE 

MANAGER 


PURCHASING 
DEP T MANAGER 


INVESTIGATION 
DEP T MANAGEF 

"_ 1 


1 . 


1 


_ 1 _ 


1 


J_ 


_ 1 _ 


_ 


1 


GENERAL ACCOUNTS 
STATISTICS 
Merchandise 
E*parise 
LEGAL 

REAL ESTATE 
INSURANCE 
CASH OFFICE 
PAYMASTER 
INTERNAL AUOlT 


RETAIL ACCOUNTS 
Authorization 
Collection 
DEFERRED PAYMENTS 
Authorization 
Collection 

Contract accounts! 

Authorization 

Collection 

ACCTS. RECEIVABLE 
SALES AUOlT 
ADDRESSOGRAPH 


PURCHASE CONT- 
TERMS ORDER 


ACCTS. PAYABLE 
FOREIGN DIVISION 


FLOOR SUPT. 
SECTION MANAGER 
ASSISTANT BUYERS 
HEADS of STOCK. 
PUBLIC SERVICE 
BUYERS CLERICAL 
DIRECTORS 
ELEVATOR OPERS 
DOORMEN 
TELEPHONE OPER S 
SHOPPING BUREAU 
RESTAURANT 
CONTINGENTS 


RECEIVING 
CHECKING 
and MARKING 


STOCK ROOMS 
WAREHOUSE 
FUR STORAGE 
CASHIERS 
INSPECTORS 
WRAPPERS 
PACKERS 
DELIVERY 
WORK ROOMS 
GARAGE 

MAIL4PHONE ORDER 
BUREAU of ADJ MENT 
CORRESPONDENCE 


EMPLOYMENT 
TRAINING 
CENSl/5 BUDGET 
SALARY REVIEW 


EMPl OYMENT 
RECORD 


SOCIAL SERVICE 
HOSPITAL 

DRESS REGULATION 
RECREATION 
LABOR TURNOVER 


PAINTERS 
CARPENTERS 
ELECTRICIANS 
PLUMBERS 
MECHANICS 
PORTERS 
CLEANERS 
ENGINE ROOM 
FIXTURES 
LAUNOCRING 
NIGHT CLEANING 
WASH ROOMS 
LOCKER ROOMS 
VENTILATION 
REFRIGERATION 


STORE 

EQUIPMENT 


STATIONERY A 
PACKING SUPPLIES 


SALVAGE 
MACHINE REPAIR 


SUPPLY STOCK ROOM 


SUPPLY RECOROS 


DETECTIVES 

WATCHMEN 


MCHT SUPT 
NIGHT WATCHMEN 


Organization Chart of 


































































































SIDENT 

D 

MANAGER 


ANAGER 

^CHANDISE MANAGER 
PUBLICITY MANAGER 


UN PARTMENT 

SYSTEM 5 

[«§>IZATION 
LAYOUTS 
[^DARDIZATION 
W itUDIES 
ESEARCH 
CONTROL 


BOARD 


MERCHANDISING DIV 


MERCHANDISE MANAGER 


MERCHANDISE 

CONTROL 


MERCHANDISE BOARD 


MERCHANDISE MANAGER 
DIVISIONAL MDSE MANAGERS 
MERCHANDISE CONTROL 
PUB. DIRECTOR, Advisory Member 
GENERAL MANAGER, t. cu.ci.i 


PUBLICITY DIVISION 


PUBLICITY MANAGER 


BASEMENT 
MERCHANDISE MGR. 








DIVISIONAL MDSE MGR 
FANCY GOODS 



DIVISIONAL MpSE MGR. 
PIECE GOODS 



DIVISIONAL MDSE MGR 
WOMEN'S WEAR 


DIVISIONAL MDSE MGR 
SMALL WARES 

BUYERS & ASSISTANTS 



BUYERS 4 ASSISTANTS 



BUYERS 4 ASSISTANTS 


BUYERS 4 ASSISTANTS 







DIVISIONAL MDSE MGR 
INTIMATE APPAREL 



DIVISIONAL MDSE MGR. 
CHILDREN S WEAR 



DIVISIONAL MDSE mGR 
MFN S WEAR 


DIVISIONAL MDSE MGR 
READY TO WEAR 

BUYERS & ASSISTANTS 



BUYERS 4 ASSISTANTS 



BUYERS 4 ASSISTANTS 


BUYERS 4 ASSISTANTS 








DIVISIONAL MDSE. MGR 
HOUSEWARES 



DIVISIONAL MDSE MGR 
MISCELLANEOUS 



divisional mdsf mgr. 
CONTRACT 


DIVISIONAL MDSE MGR. 
HOUSEWARES 

BUYERS 4 ASSISTANTS 


BUYERS 4 ASSISTANTS 


ASSISTANTS 


BUYERS 4 ASSISTANTS 


ADVERTISING 


PROMOTION 


DISPLAY 

1 1 1 

NEWSPAPERS 





DIRECT MAIL 


INSTITUTIONAL 


WINDOWS 

OUTDOOR 


SPECIAL EVENTS 


INTERIOR 

RADIO 


ATTRACTIONS 


SIGN WRITERS 

COMPARISON 


BARGAIN TABLES 




Ietail Dry Goods Store 






































































































































* 














































BUYING AND SELLING 


289 


each are kept in separate accounts. In dry goods department 
stores, dry goods represents the predominating division and 
largest investment, all other lines partaking of the nature of 
auxiliaries. The introduction of the department store plan into 
the United States is generally credited to A. T. Stewart, of New 
York City, who is said to have got the idea from the dry goods 
establishment of Todd, Burns & Company, of Dublin, Ireland, 
about 1850. The departmental idea first gained prestige in New 
York City, but soon found its way to neighboring cities and States, 
and has been generally adopted in a more or less modified form in 
towns, large and small, throughout the country. 

The modern retail department store can not be said to have 
been the direct invention of any one person or group of persons. It 
is a natural product, evolved from conditions that exist as a result 
of fixed trade laws. Its development has been slow and gradual, 
though constant, during the past sixty years. At first, fancy goods 
and notions were added to the stock of general dry goods; after 
a while laces and embroideries were added. Allied lines were 
added year by year, one at a time. When millinery and ribbons 
and a department for the making to order of mantles and costumes 
were added, the great increase in the number of feminine customers 
which these departments attracted made the addition of new 
departments somewhat more rapid. By slow degrees the fol¬ 
lowing lines were added to metropolitan stocks in the order named : 
Carpets and upholstery, furs, women’s muslin underwear, boys’ 
clothing, furniture, crockery and glassware, house furnishings, 
men’s clothing, toys, leather goods and trunks, cutlery, silverware, 
patent medicines, stationery and books, jewelry, shoes, groceries, 
hardware, and stoves. The later additions include pianos, sport¬ 
ing goods, tobacco, the restaurant, optical goods, drugs, the 
physician, the dentist, the manicurist, the photographer, and the 
undertaker. 

Before the advent of the department house, the stores of most 
of our large cities were of the average dimensions of about 25 feet 
front, and from 75 to 150 feet in depth, the business being usually 
confined to the ground floor. There were stores selling only dry 
goods proper, with others selling fancy goods and notions. The 
former were greatly in the majority. 


290 ECONOMICS OF CLOTHING AND TEXTILES 


The late Mr. John Wanamaker stated that: “The department 
store is in a sense a return of the old style of country cross-roads 

store, where articles of every 
description were sold.” 

Selective Distribution. Se¬ 
lective distribution means that 
the manufacturers select the 
wholesalers they wish to have 
market their merchandise and 
in most cases determine the 
prices, conditions of resale, etc. 
One who is not thoroughly fa¬ 
miliar with the method might 
question its desirability, but 
experience shows that results 
have more than justified the 
efforts involved. In most cases 
the manufacturer sets the price not only to the wholesaler but also 
to the retailer. In a great many cases he even specifies or suggests 
retail prices, and in advertising by circulars, magazines, and over 
the radio endeavors to help promote the sale of the merchandise 
not only through the wholesaler but through the retailer and the 
ultimate consumer. 



Chart of Distribution 
Showing how six competing textile 
manufacturers approach a prospec¬ 
tive purchaser. 


6 Manufacturers 



6 "Distributors” 


6 Dealers 


This method of selective dis¬ 
tributing can be illustrated by 
the experience of two firms 
manufacturing underwear. 

One mill undertook to sell di- 
rect to retailers. The first 
year selling expense reached 
30 per cent, and loss on bad 
accounts 25 per cent. An¬ 
other mill adopted selective 
distribution, and its total 
selling expense on actually mil¬ 
lions of dollars of business last 
year was $106. The number of accounts, of course, was small, 
and there were few if any losses. Having once chosen their 


Consumer 

Chart of Distribution 
Showing how six competing auto¬ 
mobile manufacturers approach a 
prospective purchaser. 


















BUYING AND SELLING 


291 


outlet, the work of selling was over so far as the mill was con¬ 
cerned. 

Qualifications of a Trader. The success of every distributing 
agent depends upon his ability to sell the textiles that he receives. 
The selling agent and commission agent must know the tendency of 
the styles and of “human wants for textiles” in order to know the 
textiles that should be manufactured by the mill. In addition he 
must know how to sell textiles in large quantities and be able to 
quote prices in terms of large sales. The same statement applies 
to the jobber, who acts between the selling agent and the retailer or 
small manufacturer of clothing. He must know the values of tex¬ 
tiles in terms of the needs of the selling trade and the small retailer. 
The converter must know how to determine the needs of the trade 
and to give directions for finishing the cloth. The retailer sells direct 
to the consumer in small units and naturally renders greater service 
to the consumer than any of the other distributing agents. 

Certainly in these days there is no other problem connected with 
the textile industry so important as the selling of its merchandise. 
The first cardinal point in any sales operation is undoubtedly the 
determination of the market. By this we mean: — Where are 
the customers located, how many are there, what is the size of their 
business, how and when do they buy, what is their credit, and their 
capacity for handling merchandise? Next a determination must 
be made of how the accounts are oriented geographically with 
respect to trading centers, transportation facilities, cost of transpor¬ 
tation, and other related items. From these facts can be worked 
out the expense of moving salesmen about the territories. A 
program must then be laid out determining whether sales shall be 
made by wholesale distributor, whether they shall be direct, or 
whether a combination of the two methods shall be used. If 
company warehouses are a necessary part of the distribution 
system, their locations must be determined, the size established for 
each location, and the cost of operation estimated. These factors 
are dependent upon the capacity of the local market, as determined 
in the survey previously mentioned, to absorb merchandise. They 
are also determined to a certain extent by the shipping facilities 
and by the promptness with which customers expect delivery of 
the goods they have ordered. 


292 


ECONOMICS OF CLOTHING AND TEXTILES 



Chart When Each of 50 Retailers Sends an Order to 10 Factories 


Each store sends in an order to each factory; each factory sends one 
shipment to each store; 10 orders from each store; 50 shipments from 
each factory; 500 orders, 500 shipments; 500 times the minutiae of detail 
involved in receiving and filling an order, and receiving and checking a 
shipment, are gone through. 



Chart Courtesy Wholesale Dry Goods Institute 

Chart When 50 Retailers Buy and 10 Factories Sell through 
One Wholesaler 

Each factory reaches 50 retailers; each retailer reaches 10 factories 
through one transaction. Sixty transactions instead of 500; 440 trans¬ 
actions eliminated. An 88% reduction in the number of transactions be¬ 
tween 50 retailers and 10 factories. 

If the sales approach is to be made direct, the customers must 
be divided into classes of accounts, and decisions must be made as 
to how often the customers in each class of accounts are to be 
















BUYING AND SELLING 


293 


approached. Having done this, and having determined how many 
calls each salesman can make in a locality in a day, it is possible to 
divide the sales area into individual salesman’s territories, which 
may then be grouped into sales districts as circumstances direct. 

A successful buyer and seller of textiles should have the point of 
view of the selling and buying public. The buying public has 
certain needs. The selling public should ascertain these needs by 
an analysis of the demands and requirements of the consumer 
within his financial ability. The selling agent should attempt to 
meet the demands at a reasonable profit above the cost of selling. 

The success of all trading agents depends upon the ability: 
(a) to determine the needs of the customer and to meet them by 
offering the proper textiles and service; ( b ) to be sympathetic with 
the interests of the customer and try to win his confidence; (c) to 
know the textiles one is selling so well as to be able to answer any 
question about them, their use, value, advantages, and disadvan¬ 
tages ; (d) to sell scientifically by bringing out the selling points of 
the different kinds of textile's and not attempt to sell them by name 
only. A successful selling agent should know the technical side of 
textiles — their uses, how they are made, the raw materials, yarns, 
structure, and finish of all fabrics. 

To become a good buyer you must: 

1. Know your customers. 

2. Know your merchandise. 

3. Cooperate with executives and with your manufacturers. 

By knowing your customers you will know whether they want 

fine quality, medium quality, or low quality merchandise. This 
involves knowing the spending power of the customer. Every 
store caters to a certain type of trade, and its success is measured 
by its interpretation of the customers’ wants, and the ability to 
offer merchandise which will build up prestige and bring the in¬ 
evitable reaction of buying. If the buyer knows his merchandise 
well, he will be able to work with the manufacturers to mutual 
advantage and profit. 

The clothing manufacturer sets three rules for himself: 

1. Make what the public wants. 

2. Sell it for what the public can pay. 

3. Perform these operations at a cost that yields a profit. 


294 ECONOMICS OF CLOTHING AND TEXTILES 


Under one or another of these points are covered all the efforts 
that must be expended in order to get the most out of any given 
industrial concern. This does not mean that such efforts, even 
though wisely conducted, will invariably yield a profit, but it does 
mean that such efforts wisely conducted will yield the greatest 
return possible. 

Reducing the Cost of Marketing. With the development of mass 
production and marketing in America, businesses are growing larger 
year by year. Business has passed through and out of the pioneer 
stage. A new kind of leadership is required for the new kind of 
business. Mass production calls for mass marketing, which implies 
more than the problem of mere quantity. It means that the large 
quantities of goods turned out by the factories should be put into 
the hands of the consumers at the lowest possible price. This 
involves the elimination of every possible waste in handling and 
selling. 

Various attempts have been made to reduce the tremendous cost 
of marketing, particularly in wearing "apparel, by eliminating the 
charges of some of the marketing agencies, such as commission 
merchants, jobbers, and in some cases the converters, with their 
large staff of traveling salesmen. The principal means introduced 
to eliminate the cost of distribution are : (a) direct selling, (6) resi¬ 
dent buyers, (c) chain stores, and (d) group buying. 

In most of these substitute methods large quantities of goods are 
purchased directly from the manufacturer at a special low price. 
In the chain-store distribution we find the cost of selling is further 
reduced by the elimination of charge accounts and delivery 
service. 

The five-and-ten-cent stores distribute cheap imported and 
domestic smallwares. Their large volume of business has been little 
affected by the depression, which emphasizes the fact that our 
people want to buy in the lowest-priced market. 

Elimination of the Middle Man. The widely accepted idea that 
the vast bulk of the manufactured product of this country reaches 
the ultimate consumer through the medium of wholesalers and 
middlemen of various sorts, and thence through the retailer has 
been disproved by statistics. Nearly 30 per cent of approximately 
$60,000,000,000 worth of products of the manufacturers of the 


BUYING AND SELLING 


295 


United States in 1929 was sold to industrial and other large con¬ 
sumers. The proportion sold by the manufacturers directly to 
small home consumers was comparatively insignificant, being less 
than 2 per cent. The nearly $60,000,000,000 worth of manu¬ 
factured products constituted 84.7 per cent of the entire product 
of manufacturing industry, as reported to the Bureau of the 
Census. The remainder of the product comes from branches of 
industry. 

In earlier days of American industry, the selling of manufactured 
goods was largely separated from their production, and the group 
of middlemen known variously as selling agents, factors, brokers, 
manufacturers’ agents, and commission houses intervened between 
the manufacturer and the wholesaler. However important this 
relationship may have been in times past, or may still be in certain 
industries, it is at present relatively unimportant in the aggregate, 
since less than 9 per cent of the goods sold by manufacturers passes 
through such agencies. 

The United States Census shows that of the approximately 
$60,000,000,000 worth of sales reported by the manufacturers of 
the United States in 1929, only 47.6 per cent passed into the hands 
of wholesalers, and nearly one-third of this wholesale business was 
handled by the manufacturers’ own wholesale branches. The 
balance of the total sales, 52.4 per cent, was made to retailers and 
to consumers direct. Sales direct to independent retailers consti¬ 
tuted 19.8 per cent of the total, while 2.1 per cent passed through 
the manufacturers’ own retail branches. 

The above figures contradict the popular belief that manufac¬ 
turers sell primarily to independent wholesalers and also demon¬ 
strate that the middleman is not so important a figure in the 
channels of trade as formerly. While it is true that nearly one-half 
of the entire product sold passes into the hands of the wholesalers, 
there is conclusive evidence that a very large portion of this 
wholesale distribution is under the control of wholesale agencies 
directly affiliated with the manufacturing concerns. 

Middleman’s Services. Competition exists in the field of 
exchange among middlemen or merchants as well as among the 
producers or manufacturers. The merchant’s or middleman’s 
profit depends upon his talent as a merchant or trader. 


296 ECONOMICS OF CLOTHING AND TEXTILES 


Since the trader or middleman performs a service by furnishing 
to both the producer and the consumer price standards by which 
they can value their commodities, he becomes a strong factor in 
determining the market price. He really provides the market 
price for all such commodities as : (a) raw rubber, (6) raw leather, 
(c) raw cotton, silk, wool, etc., (d) semi-finished or manufactured 
commodities, such as yarns, unfinished fabrics, finished fabrics, 
costumes, etc. 

Many people feel that the rise in prices during the past generation 
was due to the profits and activities of the middleman, but careful 
examination will show that this is not absolutely true. It is a 
fact that the middleman has contributed to the rise of prices to 
some degree, but the rise of prices was due chiefly to : (1) increase 
of population, (2) better living conditions, (3) increase of gold, 
and (4) war conditions. 

The exchange process in the clothing trades, etc. contains 
many abuses and weaknesses and can be improved, but not by 
eliminating the trader or middleman. We must remember that 
the manufacturer who sells directly to the consumer does not 
determine the price. The market price governs his price even 
if he sells a little cheaper to the consumer than do the other 
agencies. 

There are many different classes of traders in the wearing apparel 
industry. They all have a part in determining or fixing the price. 
Which one determines the price to the greatest extent is hard to 
determine. 

Investigations of the cost of manufacturing and the cost of 
selling wearing apparel — particularly clothing, textiles, etc. — 
show sometimes that the total cost of selling is greater than the 
cost of manufacturing. 

Why It Costs More to Sell than Manufacture. It may seem 
strange that it costs more to sell than to manufacture a commodity, 
but an analysis of the selling problem will show that this statement 
is often true. It may be well to outline some of the factors in the 
cost of selling: 

(a) Determining the exact field or market. 

(b) Finding the most effective system of presenting goods to 
the public — advertising. 


BUYING AND SELLING 


297 


(c) An investigation of the financial standing of the buying 
public. 

(d) Investment and upkeep of building and equipment of show¬ 
room, storage, etc. 

(e) Expenses and salaries of selling force and assistants. 

(/) Cost of transportation — freight, trucking, storage, insur¬ 
ance, etc. 

(i g ) Losses due to bad debts, depreciated goods on hand, etc. 

(h) Accumulation and classification of information relating to 
the field of manufacturing and destination. 

(i) Fair profit on capital invested. 

Market Prices. Prices for costumes and other wearing apparel 
are made in the open market, in the field, over the telephone, etc., 
by agreements between buyers and manufacturers after inspection 
of samples, or by the use of model costumes, shoes, etc. 

The term market is used with many different meanings: (a) a 
place where merchandise or commodities are shown or exposed 
in large quantities by the sellers for the inspection of the buyers 
(thus in certain western states bags containing the fleeces of wool 
are opened in large storehouses for inspection and sale to the 
eastern wool buyers); ( b ) a locality or country where commodities 
such as cotton goods may be sold (thus certain cities in South 
American countries are spoken of as the market for cotton goods 
for those countries); (c) a gathering place for private inspection 
and sales, such as the salesrooms of a dress house in New York 
City; ( d ) the prevailing prices of certain commodities, such as 
cotton sheetings of definite construction and weight, on a certain 

^The market may be local, national, or international. The cotton 
market is international, which means practically that there is one 
price throughout the world. 

Prices for textiles and wearing apparel are usually governed by 
the supply and demand. In' the case of raw cotton and raw silk 
there are exchanges — a cotton exchange and a silk exchange — 
where buyers and sellers meet and determine the price of the raw 

textile by bargaining. . . 

The market or wholesale price is determined by the struggle in 
the open market of the buyers and sellers of wearing apparel or 


298 ECONOMICS OF CLOTHING AND TEXTILES 


other commodities. The traders are matching their judgments 
and bargaining ability against each other. One group, the sellers, 
represents the viewpoint of the marginal producer, and desires to 
secure as high a price as possible for the material it owns or 
controls. Another group of traders, those who represent the view¬ 
point of the marginal consumer, feels that the price of the com¬ 
modity is too high and desires to purchase as cheaply as possible. 
Conditions in the industry, total demand, and available supply, 
together determine the final price at which exchange will take 
place. 

Go to any wholesale district for wearing apparel — such as the 
cotton or silk center — and notice the bargaining between the 
buyers and the sellers. If the demand for silk fabrics seems to be 
increasing, the traders representing the silk producers will increase 
the price, hoping to sell their entire stock before reaction for lower 
prices occurs. On the other hand, if there is a falling off in the 
demand, the price is lowered in order to attract the least eager 
buyers, who are the marginal consumers. 

On the exchanges the natural competition of buyers and sellers 
is influenced by speculation. The buyers, or those who think 
the market price of a certain commodity is going up, are called 
bulls. The sellers, or those who think the market price is going 
down, are called bears. 

Normal Price. The normal price or normal value of wearing 
apparel is the price or value that just covers the cost of produc¬ 
tion and marketing. Of course prices go above and below the 
normal price and constitute the fluctuations from day to day, and 
these are reported each day in trade papers such as the Journal 
of Commerce. This fluctuation may be plotted as a curve or 
broken line as shown in the chart. 

The market price is the price of a certain commodity, such as 
raw silk of certain specification, on a certain date. The normal 
price is the average of market prices for a long period of time. 
Of course, it is understood that the market price is the price of 
a commodity in large quantities, rather than a single unit — a 
pound. 

The value of cotton sheeting of certain grades to the buyer and 
the seller tends to become a basis of exchange where the marginal 


BUYING AND SELLING 


299 


utility of the cotton sheeting just compensates for its marginal 
cost. This basis of exchange gives us the normal value of the 
sheeting. If it sells above its normal value, this is due to abnormal 
conditions, a queer change in demand, etc. 

Monopoly Price. When a manufacturer or company produces 
wearing apparel or textiles under a special trade name, or by a 



Chart Showing Price Movement of December Cotton 


special process, there is in this brand little or no competition from 
others. Such exclusive right of manufacture or sale of a certain 
kind of commodity is called a legal monopoly. 1 A monopoly may 
be defined as such control of a single commodity as enables a 
person to fix the price of it above or below its real value or the 
amount it would bring under competition. The control of the 
larger part of the supply of a commodity is called a capitalistic 
monopoly. It is not necessary for monopoly to control the whole 
supply of the commodity. A little over half, or about 60 per cent, 
is sufficient. 

1 See Chapter III for description of legal and natural monopolies. 




































300 ECONOMICS OF CLOTHING AND TEXTILES 


Thus if a certain type of wearing apparel is patented, the pro¬ 
ducer has complete control of its manufacture and sale. He can 
control the supply and can presumably charge as much as he 
wishes for it. But if he is anxious to have a large net profit and 
to secure that net profit as long as possible, he will set the price 
at the point where demand and price will produce the maximum 
profit. If he sets the price too high, he reduces the sales and in¬ 
creases the cost of advertising. A lower price will increase the 
sales and thus may offer greater return. He may still charge a 
price far above the cost plus a reasonable profit, because of his 
monopoly control. 

A monopoly becomes an evil when it attempts to raise prices or 
lower wages below what they would be under competition. It 
also becomes an evil when it does not equitably share with the 
producers of raw material, employees, and consumers the economies 
effected by the monopoly; and when it exacts dividends beyond 
what a fair return for investment justifies. 

Determination of Price. We live under a competitive system 
where the freedom of competition exists and where any one may 
enter any industry which provides a fair return. The price of 
any product is the result of competition among buyers and com¬ 
petition among producers who are anxious for a profit. The 
consumer, on the other hand, has an idea of what the commodity 
is worth to him and will not pay more. But unless there is a 
demand the producer will not create it. Hence we have these three 
factors — producers, traders, and consumers — at issue at all times, 
providing changes in the demand and supply as well as in the 
price. 

The desires and wants of man are subject to change as they are 
satisfied. The tendency is for the price of wearing apparel or any 
other commodity to be that which is satisfactory to the marginal 
consumer, who is willing to pay the least for it. The price of 
wearing apparel or other commodities is not determined by the 
average of the total desire for the wearing apparel, but by the 
desire of the marginal consuming class. 

To overcome this tendency and to encourage each buyer to pay 
as much as he will for the commodity, a selling device called the 
auction is used by certain large firms in selling wools. The buyers 


BUYING AND SELLING 


301 


are placed in competition with one another, and the goods are sold 
to the highest bidder, which means the highest price any buyer 
is willing to pay. Such a device overcomes the law of diminishing 
utility and markets the producer’s surplus. An excellent selling 
device for the auction is to have the wools or worsted fabrics 
attractively displayed. This adds to the value of the commodity 
to be sold and tends to encourage the buyers to think it is of 
greatest value, therefore worth the highest price. 

Some large mills like the American Woolen Company name their 
prices for auction sales at the openings. Later this policy was 
changed to that of naming tentative prices. Then again, this 
policy was followed by a practice of naming definite prices on 
fabrics. This new policy was established to meet competition 
that usually arises during the season when competitors undersell 
them from two to three per cent. The American Woolen Company 
policy of instability of prices means that with a large organization 
they feel able to meet any competition. 

Variations in Price. From our experience and observation we 
know that the price of any wearing apparel is highest at the begin¬ 
ning of the season, when most people are desirous of purchasing 
the article, such as a new hat of a particular style. The demand 
for the hats is great and the supply is only normal, equal to the 
facilities of the factory. Later in the season when the supply is 
still normal, but most customers have purchased new' hats, the 
demand is limited. Accordingly the price declines to very near 
the cost of production, since the manufacturer and the sales depart¬ 
ment do not care to have surplus hats left on their hands. As the 
price is lowered the demand for the hat increases again. 

A variation in the marginal utility of a garment, that is, the 
variation in its ability to satisfy the needs or desires of the con¬ 
sumer, will also affect the demand and hence the price. Thus, if 
silk suits become popular while the price remains the same and the 
purchasing power the same, then the unit silk suit gives greater 
satisfaction than before. Consequently its marginal utility has 
increased, and people will buy it. On the other hand, if worsted 
becomes more popular than silk, people will not get the same 
satisfaction from the declining style — silk — as from the new 
worsted suit. Because the silk suit is going out of style its marginal 


302 ECONOMICS OF CLOTHING AND TEXTILES 


utility decreases. Hence we can say that the demand varies with 
the marginal utility. 

On the other hand, if the silk dress has the same marginal utility 
and the consumer the same purchasing power, a drop in price will 
give a greater surplus of utility over cost than before, and people 
will buy more silk suits. An increase in price means that the silk 
suit will possess a smaller surplus over cost than before and demand 
decreases. 

Even when the price and the marginal utility of the silk suit 
remain the same, we may find that an increase in the supply of 
money or purchasing power will cause an increase in demand. 
The marginal utility of the dollar has decreased, causing an increase 
in the utility of the suit above its cost. If people have less money, 
each dollar means more, and the surplus of utility is less than 
formerly. On the other hand, if people have more money, 
each dollar means less, and the surplus of utility is more than 
formerly. 

The demand for luxuries in wearing apparel is very sensitive to 
changes in price. Thus we say that the demand for such products 
is “ elastic.” On the contrary, the demand for necessary wearing 
apparel, such as shoes, does not vary so quickly with a change in 
price. People continue to buy shoes, but they may demand a 
somewhat cheaper pair. The demand for such products is said 
to be “ inelastic.” 

Commodity Exchanges. In an earlier section we described the 
stock exchange and its functions. Similarly, we find central 
market places or exchanges for those who wish to trade extensively 
in certain textile commodities, such as raw cotton or raw silk. The 
buying and selling in such exchanges is carried on by traders 
according to rules made by the governing board. These traders 
are usually experts trained by years of experience. They match 
their knowledge, judgment, and experience in their trading trans¬ 
actions, and as a result of the struggle there is fixed a certain 
market price or exchange price of each commodity. This price 
is announced in the daily papers at the close of the day and is 
generally accepted as the market price for all sections of the 
country. The exchange prices are not wholesale prices, but are 
used in determining wholesale prices. 


BUYING AND SELLING 


303 


Similar markets exist for dyestuffs, rubbers, etc. — 
Dyestuff Market 
Coal Tar Crudes 


Anthracene - 



80%. 

60 - 

65 

40%. 

15 - 

17 

Benzol Wks 



Gallon - 



Pure. 

20 - 


90%. 

20 - 


Creosote Oil 



Wks gl.... 

13 - 

17 

Acids — 



Anthranillic 



Ref’d. 

85 - 

1.00 

Tech. 

75 


Benzoic — 



Tech. 

35 - 

45 

Gamma. . 

77 - 

79 

H. 

60 - 

65 

Mono F. . . . 

1.50 - 

1.55 

Naphthionic 

— 


Ref. 

70 - 

75 

Tech. 

60 - 

65 

Phthalic.. 

25 - 

27 

Picric.... 

30 - 

35 

Salicylic — 



Tech. 

35 - 


Sulphanilic 

14i- 

is 

Tobras. 

80 - 

83 

Alpha- 



naphthyl- 



amine.. . . 

32 - 

34 

Alpha-naphthol, 


technical 

57 - 

59 

Aniline oil. . 

14*- 

16 

For. red. . 

38 - 

40 

Salt. 

- 

26 

Anthraquinone — 


100%. 

50 - 

55 

Benzaldehyde — 


Tech. 

60 - 

65 

Benzidine — 



Base. 

65 - 

69 

Sulphate . 

75 - 

80 

Benzyl-chloride — 


95-97% .. 

30 - 

35 

Crude.... 

25 - 

30 

Beta-naphthol — 


Sub’d. 

55 - 

60 

Tech. 

22 - 

24 


Cresol, 

U. S. P... 10*- 11 
Cresylic Acid — 

Gallon — 

97-99% .. 49-53 

95%. 42 - 43 

Naphtha Sol. — 

Wks gl. . . 26-31 
Naphthalene — 

Flakes ... 3|- 4| 

Intermediates 

Beta-naphthalmine — 

Sub’d.1.25 -1.30 

Tech. 53-55 

Dianisidine. 2.35 -2.45 
Diethylan- 

iline. 55-60 

Dimethylan- 

iline. 25-27 

Dinitro- 

benzol- 15 - 16* 

Dinitro- 

toluol. ... 16-16* 

Dinitro- 

phenol. . . 23-24 
Dinitro-chlor- 

benzol- 13*- 14 

Diphenyla- 

mine. 34-35 

Meta-nitro- 

para-tolui- 

dine.1.40 -1.45 

Meta-nitroani- 

line. 65-69 

Meta-phenyl- 

enedia- 

mine. 80-85 

Meta-toluy- 

onedia- 

mine. 65-69 

Monoethyl- 
aniline. . . 90-1.00 
Nitrobenzol 9 - 11 
1 Ortho-amide- 

phenol. . .2.15 -2.25 
Ortho-nitro- 
aniline. . . 53-55 


1 In bond. 


Phenol — 

F. o. b. wks 
drums 14*- 18 
Toluol — 

Gal., pure, 
wks.... 30-35 
Xylol Wks — Gal. 
Commer¬ 
cial .... 26-31 


Ortho-nitro- 
phenol. . . 86-90 
Ortho-nitro- 

toluol. ... 16-17 

Ortho-tolui- 

dine. 20-22 

Para-ami- 

doacetan- 

ilid. 85 - 90 

Para-amine- 
phenol — 

Base. 78-80 

H. Cl.1.40- .. 

Para-nitro- 
acetanilid 45 - 50 
Para-nitro- 
aniline. . . 51-55 
Para-nitro- 
phenol. . . 46-47 
Para-nitro- 
orthotolui- 

dine.2.75 -3.00 

Paraphenyl- 

enedia- 

mine.1.25 -1.28 

Para-tolui- 

dine. 40-42 

R. salt. 42-43 

Resorcin, 

Tech. 65-80 

Schaffer’s 

salt. 48-50 

Solium-naph- 
thionate.. 52-54 
Toluidine — 

Base. 88 - 90 

Xylidine.... 36 - 37 







































304 ECONOMICS OF CLOTHING AND TEXTILES 


Annatto — 



Fine.... 

. 34 

- 37 

Seed.... 

7 

- 71 

Egg Prod. - 



Albumen 



crystal 

. 87 

- 89 

Yolk, granu- 


lar.... 

. 47 

- 49 

Spray. .. 

. 49 

- 51 

Cochineal — 



Silver. . . 

. 46 

- 50 

Cutch — 



Borneo.. 

. 5 

- 6 

Rangoon 

91 

- 101 

Dextrine — 

Cwt. 


White... 

.3.29 

-3.56 

Gum.... 

.3.59 

-3.79 

Canary.. 

.3.34 

-3.44 

1 Divi-divi, 

per 


ton.. . 

.28.00- .. 


Dyeing Materials 

Gallnuts — 

Aleppy... 18- 19 

1 Chinese 13 - 
Gambler — 

Common 7-§— 8 

Cubes... . 101- 10f 
Plantat’n 8-g- 81 

Indigo — 

Madras . .1.25 -1.30 
Logwood — 

Sticks, 

Haitian, 

per ton. 24.00-25.00 
Madder. . 22-25 
1 Mangrove Bark — 

Per ton.. .25.00-26.00 
1 Myrobalans — 

Per ton, ship — 

J. No. 2. .17.00-17.50 
R. No. 2.16.75-17.00 


Oak Bark — 

Red. 5 - 6 

White.... 6- .. 
Sumac — 

Ground, 

per ton. 43.00- . . 
Turmeric — 

Aleppy... 5^- 6 

Madras .. 51- 5f 

1 Valonia — 

Per ton — 

Mixtures 24.00-25.00 
Beards.. 33.00-34.00 
Wattle Bark — 

Per ton — 

Chipped. 29.00-31.00 
Dyewood Extracts — 

R Sand’s. 16 - 18 
Camw’d.. 18-20 


Extracts 


Flavine, Fustic — Quercitron — 


lemon. . . . 

.1.00 

-1.10 

Solid ord 

5 - 

51 

Crystals. 

. 12 - 

16 

Hematine 



Liquid. . . 

51- 

11 

Solid. .. . 

. 91- 

10 

crystals . . 

9 

- 18 

Hypernic — 



Sumac — 



Logwood — 



Crystals. . 

17 - 

28 

Liquid. . 

. 5 - 

11 

Liquid. . . 

6 

- 91 

Liquid. . . 

11 - 

15 

Liquid. . 

. 5 - 

6 

Solid . 

. 12 

- 14 

Solid . 

17 - 

20 

Quebracho 



Crystals. , 

. 12 

- 15 

Mangrove — 



2 Solid . . . 

. 21 - 

2 

Osage 


t~T 1 

Solid . 

4i- 

6 

Liquid. . 

.2.32 - 



orange... 7 - 71 

Rubber Exchange of New York 


No. 1 Standard Contract 


,—-Closing-■> 

High Low Mar. 29 Mar. 28 

March. 3.03 3.01 . 3.00 

April. 2305 .... 3.05 

May. 3.10-3.13 3.11 

June. 2 3.14 3 16 

July. 3.18-3.22 3.20 

August. 2 3.23 _ 3.25 

September. 3.30 3.30 3.28-3.30 3.30 

October. 2 3 34 3.37 

November. 2 3.40 .... 3.43 

December. 3.53 3.50 3.46-3.50 3.50 

1933— 

January. 2 3.55 _ 3.57 

February. 2 3.63 _ 3.66 

Spot. 2 3.10 .... 3.10 

1 Shipment. 2 Nominal. 




























BUYING AND SELLING 


305 


New “A” Contract 


April. 

* 3.02 

.... 3.02 

May. 

1 3.07 

.... 3.08 

June. 

^.ll 

.... 3.13 

July. 

' 3.15 

.... 3.17 

August. 

1 3.20 

.... 3.22 

September. 

1 3.25 

.... 3.27 

October. 

x 3.31 

.... 3.34 

November. 

1 3.37 

.... 3.40 

December. 

1 3.43 

.... 3.47 

1933 — 



January. 

1 3.52 

.... 3.54 

February. 

*3.60 

.... 3.63 


Grading of Cotton. In order to understand the exchange quo¬ 
tations on cotton, it is necessary to know the terms used in the 
transactions. The classification of cotton into the standard grades 
fixed by the Government constitutes an exceedingly difficult art. 
There is absolutely no mechanical basis, and the classification is 
a purely relative one. The kind of plant has no bearing whatso¬ 
ever on the grade, nor has the length or strength of staple. It is 
really a distinction based upon the condition of the cotton, rather 
than upon its inherent qualities. 

The grade “ middling ” is the basis upon which the market 
values of the other grades are quoted. There are eight full grades: 


Fair 

Middling Fair 
Good Middling 
Middling 


Low Middling 
Good Ordinary 
Ordinary 
Low Ordinary 


Between these full grades are the half grades, known as the 
Stricts. Some classers use quarter grades, with which we shall 
not concern ourselves here. The grades and half grades are 
quoted for whites, tinges, and stains. A stain is a heavy discolora¬ 
tion, while a tinge is a lighter hue. Partial discolorations, known 
as spots, are permissible in the lower grades of whites. The values 
of the various grades are always quoted as so many points on or 
off White Middling, a point being x^-th of a cent. Thus, if 
Middling White were quoted at 24 cents and Ordinary as 300 
points off, it would mean that Ordinary was worth 21 cents. An 
example is given on the next page of a regular quotation sheet, 

1 Nominal. 




























306 ECONOMICS OF 

CLOTHING 

AND TEXTILES 


U. S. Grades 

White 1 

Tinges 2 

Stains 2 

Middling Fair. 

. 403 on 

Nominal 

Nominal 

Strict Good Middling. 

. 328 on 

49 off a 

Nominal 

Good Middling. 


152 off a 

447 off a 

Strict Middling. 


300 off a 

618 off a 

Middling. 


456 off a 

809 off a 

St. Low Middling. 

. 305 off 

704 off a 

Nominal 

Low Middling. 

. 843 off 

1064 off a 

Nominal 

Strict Good Ordinary. 

.1230 off 

Nominal 

Nominal 

Good Ordinary. 

.1518 off 

Nominal 

Nominal 


Differentials 


The following average differentials between grades of “middling” (unless 
otherwise stated) are figures from the April 26 quotations of ten markets (on 
or off Middling) for delivery in this market May 3, 1932: 


Grade — 

Cents 

Grade — 

Cents 

Grade — 

Cents 

MidTg fair. . 

. . .65 on 

Strict low 


Light Yellow 


Strict good... 

.. .52 on 

mid. 

.22 off 

Stained — 


Good. 

. . .38 on 

Low mid. 

.49 off 

Good. 

.39 off 

Strict. 

.. .22 on 

Spotted — 


3 Strict. 

.63 off 

Middling.... 

Basis 

Good. 

. .22 on 

3 Middling. . . . 

.94 off 

Strict low.. .. 

.. .22 off 

Strict. 

Even 

Yellow Stained - 


Low. 

.. .49 off 

Strict low. 

, .49 off 

Good. 

.50 off 

3 Strict good 


Middling. 

, .23 off 

3 Strict. 

.87 off 

ordinary. .. 

.. .82 off 

Low. 

, .82 off 

3 Middling 

1.22 off 

3 Good ord.... 

.. 1.12 off 

Yellow Tinged 


Gray Stained — 


4 Extra White 

— 

Strict good 

Even 

3 Good. 

.61 off 

Good mid.. 

. . .38 on 

Good. 

. .26 off 

Strict. 

.39 off 

Strict mid.. 

.. .22 on 

Strict.. 

. .39 off 

3 Middling. . . . 

1.22 off 

Middling. . 

. . Even 

3 Middling. . . . 

. .52 off 

Blue Stained — 




3 Strict low 

. .88 off 

3 Good. 

.58 off 



3 Low. 

. 1.24 off 

3 Middling. . . . 

1.18 off 





3 Strict. 

.91 off 


It is clear that in this classification the human element plays a 
great part. The difference between quarter grades, or even half 
grades, or between a tinge and a stain, is subject to a great variety 
of interpretations. While there is no definite standard, Middling 
must be cream or white, must show no soil evidence, no gin-cuts 
or naps, may have a few pieces of leaf (not powdered), and a few 

1 U. S. Government differences. 

2 Average of differences on New York, New Orleans, Memphis, and either 
the Savannah or the Augusta exchanges. 

3 These grades are not deliverable on future contracts. 

4 For the last two days extra white good middling should have been .38 on. 






































BUYING AND SELLING 


307 


motes (immature seeds). As the grades go up the cotton must 
be freer of impurities, until the top grades have to show practically 
a perfect lustrous, silky, white, and clear fiber. In the lower 
grades the impurities increase, until in the Ordinaries we find large 
and small leaf particles, sticks, hulls, dirt, sand naps, gin-cuts, and 
spots, together with a dingy color. 

It is this classification that governs the trading on all the ex¬ 
changes, and upon which the planter originally sells his crop. The 
exceptions are those varieties of cotton that are distinct from the 
crop as a whole. Sea Islands are sold as Fancy, Choice, Fine, 
Medium, and Common. Bolly or immature cotton is sold by 
separate agreements; and Linters, the fibers regained by the seed 
mills from reginning the seed, are not sold on this basis. Neither 
is what is known as the “ City Crop/’ — loose cotton accumulated 
from taking samples — sold in this way. 

Aside from grade, there are two other qualifications which are 
of equal importance to the manufacturer: length and strength. 
Lengths are quoted in eighths of an inch, and cotton under 1^" is 
termed short, while that over If" is long. The normal lengths 
run from £" to If", and it is noteworthy that, where a normal 
difference between grades would be 25 points, the difference of 
f " would be about 250 points. 

Strength — elasticity and tensile strength — is again one of 
the mill’s requirements. The usual buyer’s test for fiber vitality 
is to compress a sample in the hand to see if it will return to its 
former shape. The importance of length is that it governs the 
fineness of the yarn to be spun, while grades affect the finish of 
the cloth. Mills can not buy mixed lots, but must have even 
running grades of fixed staple. 

Buyers of Raw Cotton. The small planters of the South are 
usually unable to finance themselves independently through the 
growing and picking seasons. Consequently, the local store¬ 
keeper, from whom the planters buy their supplies, usually extends 
credit in the form of an open account and so becomes the first 
middleman. Not infrequently the storekeeper will accept cotton 
rather than money in settlement of his accounts, and where he 
follows this practice he becomes what is known as a local buyer. 
When he has accumulated sufficient cotton, he sells either to an 



308 ECONOMICS OF CLOTHING AND TEXTILES 

intermediate buyer or to the buyer for some merchant or mill. 
In the case of the larger grower, or the syndicate of growers, the 
local buyer is usually eliminated. These planters obtain their 
credit from the large merchant buyers, who in turn are carried 
by their banks. 

Very frequently the local buyers are scattered so thickly through 


Cotton — The Square Bale 

a neighborhood, and each accumulates such small and heterogene¬ 
ous lots of cotton, that an intermediate buyer finds his way into 
the natural order. Sometimes the intermediate is merely a 
“ scalper ” who buys from the local dealer and sells to merchant 
buyers. In other cases, notably in Texas, he acts as a concen¬ 
trating agent, buying at local points from growers, and selling, 
usually at compress points, to representatives of merchants or 
mills. In the latter case he is referred to as a a street buyer.” 

When the grower surrenders his cotton to the local dealer, the 
latter usually has it ginned, but in cases where the planter is able 



BUYING AND SELLING 


309 


to finance himself he takes his cotton to the gin himself, pays for 
the ginning, and either sells in so-called gin bales (before they are 
compressed) Or, if a warehouse is available at the gin or compress 
point, holds his cotton until he can obtain a satisfactory price for 
it. The local banks perform a very important part of the crop 
financing at this stage, for since the grower sells for cash, the buyers 
require advances. These are made by the southern banks against 
buyers’ tickets, showing cotton purchased, against gin receipts, 
warehouse receipts, compress receipts, and finally when the cotton 
is shipped, against bills of lading. 

The large cotton merchants fulfill a very essential function in 
that they are responsible for the concentration of the raw material 
and for its redistribution into the proper channels of manufacture. 
They maintain branches and representatives throughout the 
entire cotton-growing areas and are directly connected by wire 
with all the important exchanges. By far the bulk of their buying 
is done after the close of the New York Exchange. They buy 
from local and intermediate buyers who during the day have been 
acquiring mixed lots of all sorts. The merchant’s representative, 
known as the “ take-up ” man, goes over and classifies the cotton 
accumulated by the local buyers, takes from each bale a sample 
which he tags with a duplicate of the shipping tag he places on the 
bale itself, and then ships the cotton to the concentration point 
and the samples to the office at that place. He pays the local 
buyer by draft or check. 

The office at the concentration point, usually located where there 
is a compress, has in the meantime received instructions from the 
head office as to how to make up the various lots. As the bales 
are compressed they are collected into even-running lots of 
certain grades for which the head office has received inquiries 
from mills, and are shipped out in this way. The branch office 
will ship according to instructions, forwarding the bills of 
lading with invoices and sight drafts to the head office or to some 
bank. 

Since the World War, the cooperative movement has in some 
sections developed to such an extent as to supplant in large part 
the old system of marketing. In Texas, Georgia, and other 
States, a large part of the crop is now concentrated, financed, 


310 ECONOMICS OF CLOTHING AND TEXTILES 


and sold through these extensive organizations of growers, either 
directly to mills or to large merchants and exporters. 

Almost all cotton is bought on Middling basis, but some is taken 
on sample with guarantees (often a dangerous practice for both 
parties), and some is taken at a fixed price per bale. 

A few southern mills buy direct from near-by growers, but the 
great majority and practically all the northern mills obtain their 
cotton through merchants, or through brokers representing south¬ 
ern merchants. 

We have seen briefly how the cotton is grown and brought to 
market, but we have still to consider the all-important question 
of what determines the price at which it changes hands. 

Trading on the Cotton Exchange. In order to explain in detail 
the workings of the cotton exchange it may be necessary to review 
information in an early part of the book. The traders or specu¬ 
lators on the cotton exchange make a thorough study of crop and 
market conditions and can determine in advance, long before the 
consumer and the producer are able to, the true situation and 
prospective changes in the market supply and demand. As a re¬ 
sult they discount the future, and the market becomes steadier and 
changes more gradual because of their activities. 

To illustrate: A speculator with advance information about 
raw cotton can anticipate future conditions, and if conditions are 
not favorable for a rising market (if the supply is more than the 
demand), he sells and the price gradually falls and consumption 
increases. If the speculator had not exercised his judgment in 
buying the cotton, it would have continued to sell at the same lower 
or higher prices until the new conditions prevailed, when the price 
would suddenly jump higher or drop lower, causing much harm 
and distress both to the producer who had sold the cotton and to 
the consumer who had bought it. One can naturally see that the 
price change would be greater than under speculation, because the 
supply would not have been reduced or conserved during the pre¬ 
ceding time. In other words, speculation wisely done and based 
upon sound judgment tends to conserve the supply of cotton 
before a shortage is noticed, and to accelerate the consumption 
before an over-supply occurs, and in this way prevents sudden 
fluctuation of prices. 


BUYING AND SELLING 


311 


The speculator attempts to secure information not known to the 
general public, and buys or sells commodities, such as raw cotton, 
to make a profit. If he feels that there will be a scarcity or great 
demand for cotton, he will buy and then sell at a profit when the 
demand or scarcity becomes known. On the other hand, if he 
feels that there will be an excess, or low demand for cotton, he will 
sell, knowing that he can buy back later at a lower price. 

Sometimes speculators buy or sell according to their feelings, 
which may or may not be later supported by facts. Such specu¬ 
lators are called gamblers because they take chances on making 
a profit instead of trading on the basis of sound information. For 
example, the traders who believe that the prices of cotton are too 
low, will naturally buy, and are called bulls. On the other hand, 
if another group of traders feel that the prices are too high and 
not warranted by conditions, they will sell; they are called bears. 
Of course, a trader may change his opinion — in the same day be 
a bear on cotton in the morning and a bull in the afternoon. 

If, on the other hand, the speculator receives information from 
some reliable firm or agency in the South that the cotton crop is 
to be exceedingly large, without a corresponding demand, then 
he immediately becomes a bear on cotton and sells at the present 
market. When the bearish action on cotton takes place, the price 
falls and consumption will increase. 

The textile industry, as well as the members of society, can not 
stand sudden rises or drops in prices, which cause much damage. 
Therefore, the professional trader in cotton earns his profits if his 
judgment is good in speculation. We must bear in mind, however, 
that speculation without judgment or knowledge is mere gambling, 
and very harmful to the trade and to society. The board of gov¬ 
ernors of the cotton exchange and other exchanges are familiar 
with the effects of gambling and unsound speculation, and have 
tried to restrain it as much as possible. 

In order to trade on the cotton exchange, or on any other ex¬ 
change, a trader must become a member by paying a large sum 
for a seat, or the privilege of buying and selling cotton. It is not 
uncommon for a group of members with outside influence to buy 
all the available supply of cotton or other commodity and then 
attempt to dictate the price to the consumer. This is called 


312 ECONOMICS OF CLOTHING AND TEXTILES 


“ cornering the market ” and is considered a bad practice, un¬ 
ethical, and punishable by law because the group is attempting 
to secure a monopoly on one commodity, such as cotton, and to 
dispose of it at an unreasonable price. 

Another practice, called “ wash sales,” is the action of a group 
of members in selling cotton through one broker and buying 
through another, thus creating a feeling of activity of the stock and 
increasing the sales by artificial means. 

Arbitrage consists of buying and selling the same commodity, 
such as cotton, in two different markets, in order to profit by the 
difference in price. For example, raw cotton may be selling in 
two exchanges or markets at different prices. Note the quotation 
of cotton in the different markets on the same day. 


Liverpool Cotton Market 


April. 

Open 

High 

Low 

Close 

4.66 

Prev. 
close 
4.74 1 

May. 

.... 4.66 

4.67 

4.65 

4.66 

4.71 

June. 




4.63 

4.68 

July. 

.. . . 4.64 

4.65 

4.63 

4.63 

4.68 

August. 




4.64 

4.68 

September. 




4.65 

4.69 

October. 

... . 4.66 

4.67 

4.65 

4.66 

4.70 

November. 




4.67 

4.71 

December. 




4.70 

4.74 

1933 — 

January. 

. .. . 4.70 

4.72 

4.70 

4.71 

4.75 

February. 




4.73 

4.78 

March. 




4.76 

4.80 

April. 




4.78 

4.82 


New Orleans Market 

Prev. 

Open High Low Close close 


May. 5.95 6.04 5.95 2 6.08 5.99 

July. 6.14 6.25 6.13 6.24 6.17 

October. 6.36 6.48 6.36 6.47 6.39 

December. 6.51 6.63 6.51 6.63 6.55 

1933 — 

January. 6.64 6.64 6.64 2 6.71 6.63 

March. 6.80 6.85 6.80 6.84 6.78 


1 These prices are in pennies — 4.66d. 


2 Bid. 






















BUYING AND SELLING 


313 


Chicago Market 


Prev. 

Open High Low Close close 


May. 6.06 6.17 6.10 6.17 6.11 

July. 6.24 6.34 6.24 6.34 6.29 

October. 6.46 6.57 6.46 6.56 6.50 

December. 6.61 6.73 6.61 6.73 6.67 

1933 — 

January. 6.69 6.77 6.69 6.77 6.77 

March. 6.88 6.95 6.88 6.95 6.90 


Bremen and Havre Futures 

At Bremen May American futures opened at 7.066 closed 
at 7.086 2 off; July opened at 7.206 closed at 7.236 
unchanged; and October opened at 7.310, closed at 7.346 
1 off. 

Havre May futures opened at 2.12 f, closed at 2.13 f, 
1 off; July opened and closed at 2.17 f, 1 off; and October 
at 2.20 f, 1 off. 

Egyptian Cotton Markets 

Sakels, May, at Alexandria, closed at 11.59^, 19 off; 
July, 12.106 11 off: November, 13.096 19 off; January, 
13.366 17 off. Ashmouni, June, ended at 9.996 6 off; 
August, 10.076 6 off; October, 10.326 8 off; December, 
10.476 8 off. 

At Liverpool Sakels, May, at noon and close were 6.42 d, 
5 off, and July 6.58 d, 4 off. Ashmouni, May, at noon 
was 5.71 d, at closing 5.73 d, 2 off, and July at noon 5.79 d, 
at closing 5.81 d, 2 off. 


East Indian Cotton 

No. 1 Oomra fine Indian spot cotton at Liverpool was 
4.52 d, 6 points off, yesterday. 

Broach, April-May, at Bombay was cabled at 183 
rupees, 3 rupees lower, and July-August at 190 rupees, 

2 off. Bengal, July, was 157 rupees, 1 off. 

The following tabulations from the Journal of Commerce show 
how information about weather conditions and the state of the 
cotton crop is furnished to traders each day during the season : 


Cotton States Weather 

For Tennessee — Cloudy, followed by showers in central and west portions, 
slightly cooler in extreme west portion, Saturday; Sunday showers and cooler. 

For Virginia — Partly cloudy Saturday; Sunday increasing cloudiness, 
possibly followed by showers in extreme west portion; not much change in 
temperature. 
















314 ECONOMICS OF CLOTHING AND TEXTILES 


For North Carolina — Partly cloudy Saturday; Sunday increasing cloudi¬ 
ness, possibly followed by showers in extreme west portion; not much change 
in temperature. 

For South Carolina — Partly cloudy Saturday; Sunday increasing cloudi¬ 
ness, probably followed by showers. 

For Georgia — Partly cloudy Saturday; Sunday increasing cloudiness, 
probably followed by showers. 

For Florida — Partly cloudy Saturday and Sunday. 

For Extreme Northwest Florida — Partly cloudy Saturday; Sunday 
cloudy, scattered thundershowers; moderate to fresh southerly winds. 

For Louisiana — Partly cloudy and cloudy, with scattered thundershowers, 
Saturday and probably Sunday; moderate to fresh southerly winds on the 
coast. 

For Mississippi — Partly cloudy and cloudy, with scattered thundershowers, 
Saturday and probably Sunday; moderate to fresh southerly winds on the 
coast. 

For Alabama — Partly cloudy to cloudy, thundershowers in west portion, 
Saturday; Sunday cloudy, with thundershowers; moderate to fresh southerly 
winds on the coast. 

For Arkansas — Cloudy, with scattered thundershowers, Saturday and 
Sunday; colder in northeast portion Saturday. 

For Oklahoma — Cloudy, with occasional rains, and colder Saturday; 
Sunday partly cloudy to cloudy. 

For East Texas — Cloudy, with local thundershowers, cooler in northwest 
portion, Saturday; Sunday partly cloudy to cloudy; moderate to fresh 
southerly winds on the coast. 

For West Texas — Partly cloudy, colder in north and east portions, Satur¬ 
day ; Sunday partly cloudy. 


Crop Outlook 
Daily Weather 

Official weather reports for twenty-four hours ended yesterday morning 
follow: 

Houston, first district — Rainfall 2 stations, .02 to .10 inch; maximum 
temperatures, 72 to 90; minimum, 58 to 68; cloudy 19 stations, partly cloudy 
4, raining 1. 

Houston, second — Rainfall 3 stations, .01 to .02; maximum, 72 to 90; 
minimu m , 66 to 72; cloudy 28, partly cloudy 1, raining 3. 

Houston, third — Rainfall 8 stations, .02 to .06; maximum, 78 to 88; 
minimum, 66 to 76; cloudy 15, raining 2. 

Oklahoma, first — No rainfall; maximum, 78 to 85; minimum, 65 to 68; 
cloudy 21, partly cloudy 1. \ 

Oklahoma, second — Rainfall 1 station, .01; maximum, 76 to 87; mini¬ 
mum, 60 to 68; cloudy 18, partly cloudy 3. 



BUYING AND SELLING 


315 


Little Rock, first — No rainfall; maximum, 84 to 90; minimum, 58 to 68; 
cloudy 11, partly cloudy 4. 

Little Rock, second — No rainfall; maximum, 82 to 89; minimum, 58 to 
61; cloudy 2, partly cloudy 1. 

New Orleans district — No rainfall; maximum, 84 to 91; minimum, 60 to 
66; cloudy 12, foggy 2. 

Vicksburg district — No rainfall; maximum, 84 to 91; minimum, 58 to 66; 
cloudy 5. 

Montgomery district — Rainfall 4 stations, .04 to .18; maximum, 82 to 91; 
minimum, 55 to 62; partly cloudy 2. 

Memphis district — Rainfall 5 stations, .21 to .60; maximum, 66 to 92; 
minimum, 53 to 64; cloudy 7, partly cloudy 2. 

Savannah district — Rainfall 3 stations, .05 to .20; maximum, 78 to 88; 
minimum, 57 to 62; cloudy 9, partly cloudy 5. 

Atlanta district — Rainfall 9 stations, .04 to .54; maximum, 79 to 88; 
minimum, 51 to 62; cloudy 5, foggy 1. 

Augusta district — Rainfall 4 stations, .01 to .02; maximum, 78 to 85; 
minimum, 51 to 60; clear. 

Charleston district — Rainfall 2 stations, .01 to .03; maximum, 75 to 82; 
minimum, 52 to 62; cloudy 1, partly cloudy 1, raining 1. 

Wilmington district — Rainfall 1 station, .06; maximum, 73 to 81; mini¬ 
mum, 37 to 54; clear. 

The map on page 316 is a part of a regular weekly cotton crop and 
spot market service that appears in newspapers and is especially de¬ 
signed to show in convenient graphic form pertinent weather condi¬ 
tions in each of the important unit-producing districts throughout the 
entire cotton belt. The abbreviations used in the boxes, in order listed, 
are as follows: 

Rain — Actual average rainfall in inches at the stations indicated during 
the periods mentioned. 

Normal — Normal rainfall averaged for the same stations for the same 
periods. 

High — The highest temperature recorded by any of the stations indi¬ 
cated during the periods mentioned. 

Low — Lowest temperatures recorded by any of the stations indicated 
during periods mentioned. 

Mean — Average of the actual daily highs and lows for the stations and 
the periods mentioned. 

Normal — Normal means temperature for the stations and the periods 

indicated. ' 

Clear _Average number of days during specified period on which it was 

clear at eight o’clock in the morning at the stations indicated. 

p clear — Average number of days during specified period on which it 
was partly clear at eight o’clock in the morning at the stations indicated. 


316 


ECONOMICS OF CLOTHING AND TEXTILES 









































BUYING AND SELLING 


317 


Future Cotton. With the gradual increase in commerce due to 
the rapid means of communication — telephone, telegraph, etc., 
— a new system of buying and selling cotton has developed, by 
which it is possible for a person to buy or sell upon a determined 
basis of quality to meet his future requirements. In fact, it became 
possible to buy or sell cotton twelve months in advance, even before 
the cotton was planted. 

To illustrate : If a mill man receives a contract to supply cotton 
sheeting for the next year or more, it becomes necessary for him 
to know definitely before he signs the contract what the raw cotton 
will cost him a year in advance. Therefore, before the cotton is 
grown and before he has the money to buy the cotton, he can agree 
to supply the cotton sheeting at a definite price and protect himself 
in signing the contract by contracting for cotton to be delivered 
in the future. 

The cotton bought in this manner is called future cotton. In a 
similar manner, silk, wool top, etc., may be bought on a future 
basis. 

Thus we see that cotton trading on the exchange falls roughly 
into two categories: trading in cotton for immediate delivery, or 
spot cotton; and buying or selling for delivery at some future 
time, or future cotton. Purchases or sales of spot cotton mean 
that cotton actually will be delivered from vendor to purchaser; 
but, as we shall see, trading in futures does not necessarily mean 
that the contract will be fulfilled by delivery. The great cotton 
markets are New York, Liverpool, New Orleans, Bremen, and 
Havre. Of these, New York is almost entirely a futures market, 
while New Orleans is chiefly a spot market. Liverpool, Bremen, 
and Havre trade in both spot and futures, but Liverpool is the 
European center for trading in future contracts. See cotton quo¬ 
tations from world centers. 

Only about 2 per cent of the annual crop is sold spot in 
New York, and yet it is the price on the New York Cotton 
Exchange which governs very largely the price paid to the 
grower in the South by the various buyers. The New York 
Exchange is the barometer of the American and, to a large 
extent, of the world’s cotton trade, because its mechanism 
works out the equilibrium between demand and supply. This 


318 ECONOMICS OF CLOTHING AND TEXTILES 


mechanism consists chiefly of the trading device called the 
“ hedge.” 

Hedging is an insurance against fluctuations in cotton prices 
by purchase or sale of future contracts for cotton, against sale or 



Trading Floor of the New York Cotton Exchange 


purchase made for actual delivery. It consists of nothing more 
than neutralizing the gain or loss which will result from existing 
contracts if the price rises or falls before delivery date, by creating 
an off-setting loss or gain. 

Assume, for instance, that a merchant makes a contract with a 
mill in July for 100 bales of cotton for October delivery. He sells 
at the current price of, let us say, 30 cents per pound, plus his 
overhead and profit. In due course he will obtain his cotton from 
the South, but in the meantime he covers, or hedges his contract, 
by buying 100 bales of October futures on the Exchange. If he 
has to pay the grower 31 cents for the cotton which he has sold 
to the mill for 30 cents, he will, on the other hand, be able to sell 
his future contract, which he bought at 30 cents, for 31 cents. 
The loss on one is neutralized by the gain on the other. Vice 
versa, he will lose whatever extra profit he might have made from 
a falling price. 




BUYING AND SELLING 


319 


In the same way, a manufacturer may buy futures against 
orders he has accepted for goods at prices based on the price he 
expects to pay for his cotton. Or he may sell futures to protect 
himself on cotton he has bought but has not yet covered by cloth 
contracts. Hedging by manufacturers, however, particularly in 
the North, is not a common prac¬ 
tice, because the cloth market is 
not elastic enough to follow accu¬ 
rately in the wake of cotton prices, 
and also because the mill treasurer 
rarely wants to hedge cotton in his 
warehouse, preferring to rely on his 
own judgment in matters of pur¬ 
chase. 

Occasionally a grower may find it 
to his advantage to hedge his crop. 

If, for example, he is satisfied in 
August that the present price for 
December cotton is likely to be 
higher than he will obtain later, he 
may sell December futures for a 
conservative percentage of his crop, 
thereby guaranteeing himself 
against a drop. 

By far the greatest part of the 
future trading, however, is done by ]^ EW York Cotton Exchange 
merchants, because they are actu- Building 

ally engaged in the business of selling 

cotton they have not yet acquired, or of carrying cotton for which they 
have no selling contracts. Speculation, of course, enters into the 
dealings on the exchanges as an important economic factor. In 
normal times it tends to stabilize the market by discounting future 
trends, but in periods of extraordinary demand or supply it causes 
violent fluctuations in prices. At such times there is always a good 
deal of agitation for preventive legislation, but it is unlikely that deal¬ 
ing in futures will ever be prohibited by law. The present regula¬ 
tions of the large exchanges eliminate abuse as far as possible, and the 
futures markets are really a factor of safety for the entire industry. 





320 ECONOMICS OF CLOTHING AND TEXTILES 


All the large merchants, as we have seen, have branch offices 
in the South; and all these offices have wire connections with the 
chief markets. On the basis of the Liverpool quotations (there 
is five hours difference in time) and the New York opening prices, 
the head offices will send out to their branches and representatives 
their daily limits, above which they are instructed not to buy. 
Inasmuch as most of the small growers are dependent upon the 
buyers for their news of the markets, they are at somewhat of a 
disadvantage, but the keenness of competition prevents their 
exploitation by unscrupulous buyers. 

A contract on the New York Cotton Exchange calling for the 
delivery of 100 bales specifies Middling grade, but the seller may 
deliver any grades which are tenderable by the Exchange regula¬ 
tions. These grades are from Strict Low, Middling, to Middling 
Fair, but if tinged, not below Middling Tinged. Stains are not 
tenderable. The grades are determined and settlement is made 
on the basis of so many points on or off Middling, which, as we 
have seen, is the basis for all quotations. 

It is evident that mills requiring certain even-running grades 
could never buy their cotton on the Middling basis. For this 
reason, except in the few cases where they buy directly from the 
growers, mills purchase their requirements from dealers on the 
basis of samples. Selling to mills, as opposed to selling M/B 
(Middling Basis), is known as selling on merit. Mills usually 
begin to buy in September and fill about 60 per cent of their year’s 
requirements by January. Those manufacturers who use the 
high grades usually buy earliest, because of the limited crop from 
which they must obtain their share. Cotton is ordinarily shipped 
soon after purchase, and stored, not by the merchant, but at the 
mill. The recent growth of southern warehouse companies, how¬ 
ever, has caused mills to carry less cotton than formerly. Mills 
ordinarily pay for their cotton in three days. 

Marketing of Cotton Yam and Cotton Cloth. The textile mills 
receive raw cotton and convert it into yarn or cloth. If a mill 
deals with yarn only, it is called a yarn mill, but if it weaves the 
cloth, it is called a cloth mill. 

Cotton yarn quotations are published every day in the trade 
papers. 


BUYING AND SELLING 


321 


Cotton Yarn Quotations 
1 Carded (Average Quality ) 

Double carded weav’g and knitt’g yarn 2 ^ to higher, according to quality 
Single Skeins or Tubes (Warp Twist ) 


4s to 8 s. 


20 s 

34 _ 041 

10 s. 


24s. 


12 s. 


26s 

_ _37 

14s. 


30s. 


16s. 


40s. 

.46 —47 2 


Two-Ply Skeins and Tubes 


10s-2.31^—32 30s-2. 

12s-2 .32^—33 36s-2. 

14s-2 .33 —33| 40s-2. 

lbs -2 .— —34 40s~2 High Breakage 

20s-2 . 35 50s-2. 

24s-2 .36^—37 60s-2. 

Single Warjps 

10s.311—32 24s. 

12s.321—33 26s. 

14s.33 —33| 30s. 

16s.33^—34 40s.. 

20 s.34 |—35 

Two-Ply Warps 

8s-2.311—32 24s-2. 

10s-2..32* 26s-2. 

12s-2.33 —33i 30s-2. 

14s-2 .33|—34 40s-2 ordinary . 

16s-2.34 —34£ 50s-2. 

20s-2.35|—36 60s-2. 


37|—38 



-47 

-52 

56 —57 
-63 


-37 

-38 

-40 

47 —48 


37 —37^ 

-38 

39 —39£ 
47 —48 

-57 

63 —64 


8s-3- and 4-ply skeins and tubes; tinged, 29, white, 31 
Hosiery Cones (Frame Spun ) 


8 s. 30 

10s.30^—31 

12s.31 —31| 

14s.31 —32 

16s.32 —321 

18s.321—33 

20s.33 —33| 


22 s. 

..34 

24s. 

26s. 

.341—35 

.35|—36 

30s tying in. 

..37 

30s regular. 

.38 —39 

30s extra quality. 

.39 —40 

40s. 

.46 —47 


Combed Peeler (Average Quality) 
Warps, Skeins, and Cones 


20s-2.45 —46 

30s-2.48 —50 

36s-2.50 —52 

40s-2.52 —54 


50s-2. 

.56 

—58 

60s-2. 

.63 

—66 

70s-2. 

.73 

—76 

80s-2. 

.84 

—87 


1 See author’s trade edition of Textiles for explanation in detail of terms. 





































































322 ECONOMICS OF CLOTHING AND TEXTILES 



Singles 


1 9a 

.39 —39^ 

30s. 

.47 —48 

1 

39 a 40 

38s. 

.52 —54 

"f 

40 —40£ 

40s. 

.53 —55 

1 8a 

40 —41 

50s. 

.57 —59 

9fla 

41 —42 

60s. 

.63 —65 

9d.a 

44 — 44^ 

70s. 

__72 —75 

28s. 

.46 — 46i 

80s. 

.84 —87 


Mercerized Cones ( Combed , Ungassed ) 


26s 2. 

30s-2. 

36s-2 .... 

.60 —61 

.61 —62 

.64 —65 

80s-2_ 

30s 

Singles 

. . 1 06—1 08 

..-80 

40s-2 . 

.66 —67 

40s 


..-85 

45s-2. 

.71 —73 

50s. 


..-90 

50s 2. 

.73 —75 

60s. 


..-1 03 

60s 2 . 

.82 —84 

70s 


..-1 17 

70s 2 . 

.94 —96 

80s. 


..-1 48 


Peeler — (Super Quality ) 


Single Cones 



Carded 

Combed 


Carded 

Combed 

10 s . 

.34 —35 

44 —45 

26s... 

.39 

—40 

50 —52 

14s. 

.35 —36 

45 —46 

30s.. . 

.40 

—42 

52 —54 

16s . 

.35i—36i 

46 —47 

36s.. . 

.45 

—46 

55 —57 

18s. 

.36 —37 

47 —48 

40s. . . 

.48 

—50 

58 —60 

20 s. 

.36|—37i 

48 —49 

50s. . . 


— 

60 —62 

24s. 

.38 —39 

49 —50 

60s. . . 



70 —75 


Combed Cones, Warps, and Tubes 



20s-2 . 


.48 —50 

40s-2. 



.58 —60 

24s-2. 


.50 —52 

50s-2. 



.65 —67 

28s-2 . 


.51 —53 

60s-2 



.70 —72 

30s-2 . 


.52 —54 

70s-2, 



.80 —85 

36s-2. 


.55 —57 

80s-2. 



.95 —1 00 


Combed Reverse Twist Thread Yarns — Skeins , Tubes or Cones , S-, and 4-ply 


24s. 

30s 

36s 

40s 

45s 

50s 

60s 


Peeler 


Average 
—55 57 

62 

Best 

—63 

—58 

60 

64 

—65 

—60 

62 

66 

—67 

—65 

67 

71 

—72 

—70 

72 

76 

—77 

—75 

77 

81 

—82 

—85 

87 

91 

—92 


Sakelarides 


Average 

Best 

91 

96 

94 

99 

96 

1 00 

101 

1 06 

1 06 

1 11 

1 11 

1 16 

1 21 

1 27 


Quotations are average prices of the counts and qualities indicated at the 
close of business. 





























































BUYING AND SELLING 323 

The same is true as regards staple or standard cotton cloths. 
For example: 

Quotations of Standard Construction 

March 30, 1932 


Coarse Yarn Gray Goods 


Plain Wide Print Cloth 


Count 

Width 

Weight 

Price 

96 

X 

100 

39 

4.15 

15 

96 

X 

100 

39 

5.00 

12 * 

96 

X 

92 

39 

5.25 

Ilf 

80 

X 

88 

39 

5.00 

7* 

80 

X 

80 

39 

4.00 

5* 

72 

X 

76 

39 

4.25 

51 

68 

X 

72 

39 

4.75 

4* 

64 

X 

60 

38* 

5.35 

31-3* 

64 

X 

56 

38* 

5.50 

3f 

60 

X 

48 

38* 

6.25 

3i 5 5 -3f 

56 

X 

44 

39 

6.60 

3* 

48 

X 

48 

38* 

7.15 

3 

52 

X 

40 

38* 

7.30 

3 

4 

X 

40 

38* 

8.20 

2 t 9 b - 2 | 

40 

X 

32 

40 

9.20 

2 | 

40 

X 

28 

39 

9.80 

21 

64 

X 

60 

40 

5.15 

41 

56 

X 

56 

40 

6.00 

31 

56 

X 

52 

40 

6.25 

31 

64 

X 

60 

45 

4.65 

4f-5 

56 

X 

48 

43 

5.85 

31 

48 

X 

48 

44 

6.40 

3| 

44 

X 

40 

44 

7.25 

3 

68 

X 

72 

36 

5.15 

41 

64 

X 

60 

36 

5.75 

3* 

60 

X 

48 

36 

6.70 

31 


Plain Narrow Print Cloth 


64 

X 

60 

28 

7.30 

3 

56 

X 

44 

25 

10.55 

21 

64 

X 

60 

27 

7.60 

21 

52 

X 

44 

25 

11.00 

2 

44 

X 

44 

27 

9.50 

21 

40 

X 

32 

25 

14.75 

1* 

64 

X 

60 

32 

6.50 

31 

56 

X 

52 

31* 

7.50 


48 

X 

48 

31* 

8.70 

2| 



Pajama Checks 


64 X 60 

36 5.75 

4-4* 

72 X 80 

36* 4.70 

41-4* 

88 X 88 

36* 4.00 

5* 



Carded 

Broadcloths 


80 X 56 

36* 

5.10 

41 

80 X 60 

38* 

5.00 

41 

80 X 60 

37* 

4.75 

4f 

90 X 60 

38 

4.32 

5 

100 X 60 

37 

4.10 

51 

112 X 60 

37 

3.85 

51 

116 X 60 

37 

4.10 


128 X 68 

37 

4.25 

8 


Combed Broadcloths 


Count 

Width Weight 

Price 

136 X 60 

37 

4.20-4.25 

8*-8f 

128 X 68 

37 

4.20-4.40 

8-8* 

144 X 76 

37 

4.25-4.40 

9 

144 X 76 

37 

100-2-ply 

22-23 

108 X 60 

37 

2 X 1 

14* 



Poplins 


88 X 40 

37 

3.40 2 X1 

12*-13* 

102 X 48 

37 

3.40 2 X1 

13*-14* 



Sheetings 


48 X 52 

36 

4.70 

3*-3f 

48 X 48 

31 

5.00 

3-31 

40 X 40 

32 

6.25 

2f 

48 X 48 

36 

5.00 

3f 

48 X 40 

36 

5.50 

31 

44 X 40 

36 

6.15 

3 

40 X 40 

36 

6.15 

21 

48 X 48 

36 

3.00 

4f 

48 X 44 

36 

3.25 

41 

64 X 68 

36 

3.50 

41 

44 X 40 

37 

3.50 

41 

48 X 48 

37 

4.00 

41 

56 X 60 

36 

4.00 

41 

56 X 56 

36 

4.25 

4 

40 X 36 

36 

6.50 

21 

40 X 38 

36 

3.90 

31 

48 X 48 

40 

2.50 

5f 

48 X 48 

40 

2.85 

5-51 

64 X 68 

40 

3.15 

5f-5* 

56 X 60 

40 

3.60 

4f 

56 X 56 

40 

4.00 

41 

48 X 44 

40 

3.75 

41 

44 X 40 

40 

4.25 

31 

44 X 44 

40 

5.00 

3f 

44 X 40 

40 

5.50 

31 


Tobacco Cloths (36-in.) 
(Special put-ups *?f to *)£ higher.) 


Count 

Wght. 

Pr. 

Count Wght. 

Pr. 

48 

X 

44 

7.75 

21 

32 

X 

28 14.00 

1*1 

44 

X 

44 

8.10 

21 

28 

X 

24 15.00 


44 

X 

40 

8.50 

21 

26 

X 

22 16.00 

Us 

40 

X 

40 

9.20 

2/g 

24 

X 

20 17.00 

11 

44 

X 

36 

9.30 

2 T 7 a 

22 

X 

18 19.00 

11 

44 

X 

36 

9.65 

2 f 

20 

X 

16 21.00 

11 

36 

X 

32 

11.00 

2t 1 b 

20 

X 

12 23.00 

1 





Drills 




30 


2. 

50 

51 

37 


2.35 

51-51 

30 


2. 

85 

41 

37 


2.75 

s5f-c5 

30 


3j 

00 

41 

37 


3.00 

41 

30 


3. 

25 

41-41 

37 


3.25 

41 

30 


4j 

00 

41 

37 


3.50 

4* 

34 


4. 

75 

3* 

37 


3.95 

4 




324 ECONOMICS OF CLOTHING AND TEXTILES 


Filling Sateens 


Count 

Width 

Weight 

Price 

64 X 104 

43 

3.85 

9* 

72 X 120 

43 

3.35 

11 

88 X 140 

39 

5.10 (comb.) 10* 

84 X 136 

38* 

4.25 


72 X 120 

39 

4.00 

111-11* 

64 X 104 

37 j 

4.37 

S6-6*-E61 

64 X 88 

37 5 

4.70 

S5*-5j-E5f 

64 X 72 

37* 

5.25 

5 

64 X 88 

31* 

5.50 


64 X 72 

26 

7.00 




Twills 


72 X 120 

43 

3.35 

9*-9f 

64 X 112 

43 

3.65 

81 

64 X 104 

43 

3.85 

8 

64 X 96 

40 

4.30 

61-6| 

64 X 88 

40 

4.50 

6-6* 

68 X 76 

39 

4.00 

5 

68 X 76 

39 

4.50 

41-41 

64 X 72 

39 

4.80 

41 

64 X 64 

39 

5.10 

41 

64 X 56 

39 

5.25 

. . . 

64 X 100 

31 

4.20 

8 

64 X 70 

31 

4.20 

4* 

64 X 72 

37* 

5.25 



P. W. Osnaburgs 


Wid. Wght. 

Price 

| Wid. Wght. 

Price 

36 7 oz. 

51 1 

40 7 oz. 

5* 

30 7 oz. 

41-5* 1 36 2.85 

41 

40 3.50 

31 | 

36 3.90 

3|-3* 

Fine Gray Goods 



Combed Lawns 


108 X 112 

40 

6.25 

12* 

96 X 100 

40 

7.00 

10* 

96 X 92 

40 

7.50 

91-9* 

88 X 80 

40 

8.50 

7* 

76 X 72 

40 

9.00 

6-61 

72 X 68 

40 

9.50 

5* 

84 X 80 

40 

11.00 

91-10* 

76 X 72 

36 

10.10 

51 

88 X 80 

36 8.75-9.50 

7-7* 

88 X 80 

30 

11.35 

61 

76 X 72 

30 

12.00 

51 


Legend—s Spot, c 


Dimity Stripes 


Count 

Width Weight 

Price 

96 X 68 

36 

8.75-9.00 

7* 

114 X 64 

36* 

7.50-7.60 

71-8 

116 X 76 

36* 7.85-8.00 

81-9 


Carded 

Lawns 


80 X 76 

40 


6.00 

7*-71 

72 X 68 

40 


6.00 

6*-6! 

72 X 60 

40 


9.00 

5*—5| 

72 X 60 

36 


10.25 S4f-E4*-4f 

72 X 60 

36 


10.00 

S4*-E44f 

60 X 48 

36 


10.00 


39*-40-t'». 

Combed Marquisettes 

44 X 18 


3* 

48 X 28 

5 

44 X 20 


31 

48 X 30 

51 

46 X 22 


4* 

48 X 32 

5* 

48 X 22 


41 

54 X 30 

51 

46 X 38 

39*-inch Scrim Voile 

41 


Combed Pongees 


72 X 100 

38 


6.25 E7!-7*-S7| 

72 X 100 

38 


6.25 card 

6*-61 

72 X 100 

34 


7.00 

6*-6! 



Organdies 


68 X 56 

39 


11.00 

S5*-E51 

72 X 64 

40 


13.00 

81-9 

76 X 68 

40 


13.50 

9*-10* 



Voiles 


60 X 52 

40 


Slack twist 

51-51 

60 X 52 

40 


Hard twist 

5f-6* 

60 X 56 

40 


Hard twist 

6-6* 

60 X 56 

40 


Ex. hd. twist 8 

68 X 76 

39 


70s 

10-10* 


Warp Sateens 


108 X 56 

34 


3.00 card 

5f 

110 X 68 

38 


5.00 card 

81 

120 X 64 

38 


5.25 card 

7* 

128 X 68 

38 


5.50 

91-101 

140 X 72 

38 


5.75 

9 

144 X 88 

38 


5.75 

141 

168 X 88 

38 


5.75-6.00 

19 

140 X 96 

43 


3.35 

cl7 

act. E East. 

S South. 



Cotton fabrics like other textiles are described either by (a) use, (6) structure- 
weave, or (c) trade name. Tobacco cotton cloth is used to cover and protect 
tobacco plants from hail, etc. Sateens are cotton fabrics with a satin weave. 
Marquisette, lawn, broadcloth, etc., are trade names. 

Count means the number of warp (lengthwise threads) and filling (crosswise) 
threads to the inch. Weight means the number of yards to the pound. See 
author’s trade edition of Textiles for explanation of weaves, trade names, etc. 

Marketing Cotton Cloth. Reviewing the principles of the pre¬ 
vious pages and applying them to the cotton industry, we find that 
there are four general ways in which a cotton mill may dispose of 
its products: (1) by selling direct, (2) through a selling house, 
(3) through a broker, (4) through a converter. 



BUYING AND SELLING 


325 


A few very large mills maintain selling offices of their own in the 
large centers of marketing, through which they market their goods 
direct to the jobbers and retailers. In most cases where direct 
selling is done, however, the goods are sold in the gray by the mill 
treasurer at the mill. This practice is common with those mills 
that make staple gray goods and, when not sold ahead, are able 
to manufacture for stock against spot sales. A few southern yarn 
mills also sell direct. 

The relation between the manufacturer and commercial banker 
or commission house is as old as the industry itself. Slater’s first 
mill in 1790 was financed by Almy & Brown of Boston, who under¬ 
took to market his goods and also to furnish him the credit he 
needed to buy cotton and supplies. In the early days the cloth 
was sold at auction by the selling house, and the proceeds, less 
commission, credited to the mill. Later the factors developed 
extensive selling organizations throughout the country, by means 
of which they were able to market the products of many mills. 

The marketing of fancy goods requires a great deal of skill. 
The fall and spring lines to be manufactured by the mills are sent 
out to the trade by the selling house about six months ahead, and 
orders are taken before manufacture begins, so as to be sure that 
the line will “ take.” Of course there is always the danger of 
cancellations even then, for which the selling house must bear most 
of the responsibility. 

In addition to marketing the goods and guaranteeing the ac¬ 
counts, the commission house renders financial assistance either 
by advancing on the mill’s product or by indorsing its notes. In 
return it receives the sole agency for the mill’s products, interest 
on the money advanced, and a commission. The latter varies 
with the amount of financial assistance required by the mill and 
the desirability of the risk. 

As a general rule the southern mills, because of their distance 
from the chief markets in New York, Boston, and Philadelphia, 
are more dependent upon their selling agents than are the New 
England manufacturers. 

In New England a great number of manufacturers are amply able 
to finance themselves, and could, if necessary, sell their own prod¬ 
ucts. However, stock ownership and old ties have frequently 


326 ECONOMICS OF CLOTHING AND TEXTILES 


kept up the relationship with the selling house after its usefulness 
has been partly outworn. Nevertheless in the selling of fancy 
goods, even where the mill is supplied with plenty of capital, the 
commission house fulfills a very necessary function. 

Gray goods are very often sold either by a mill or a selling house 
through the medium of a cloth broker. The latter is strictly a 
middleman in that he does nothing but bring together the pro¬ 
spective purchaser and seller. In the event of sale, he gets a com¬ 
mission of per cent, which he often more than earns by his efforts. 
These brokers are in touch with all the mills, converters, and con¬ 
sumers. 

While there are some independent finishing establishments, 
most of them operate on a commission basis for merchant con¬ 
verters. The latter are a class of merchants of comparatively 
recent origin, having first appeared about 1880, since which time 
they have practically taken control of the finishing industry. 
They buy gray goods either directly from the mill or through a 
broker or selling house, and have them finished according to what¬ 
ever they think the requirements of the market are. Inasmuch 
as they pay on short credit and carry the goods during conversion, 
frequently selling on several months’ credit to jobbers and retailers, 
they perform an important part of the financing of the cloth. 
Their recent rapid rise has been due largely to the growing demand 
for a multiplicity of seasonal designs. Many large mills act as 
their own converters. 

Some large cutters-up and a few big mail-order houses do their 
own finishing or have it done. As a rule they buy from converters 
and sell to the jobber, retailer, or consumer. 

The Wool Market. The buying and selling of wool differs in 
some respects from that of cotton. There is no exchange for the 
organized buying and selling of raw wool. Years ago an attempt 
was made to create such an exchange in New York, but it did not 
survive long. In order to understand the marketing of wool, it 
is necessary to know something of the industry and the tech¬ 
nical terms and processes. Some idea of the scope of the wool 
business may be gathered from the following facts. 

There are 800,000 farmers raising sheep in this country, some of 
them in every State. At the beginning of 1932 there were 


BUYING AND SELLING 


327 


36,000,000 sheep in the United States, valued at $4.80 a head, or 
in the aggregate at $172,800,000. It is expected that the returns 
from the wool clip in a fairly good year will pay all a sheepman’s 
running expenses, such as hire of herders, costs of shearing, etc. 
He then has the sale of his lambs as clear profit. Enormous for¬ 
tunes are being made in the sheep business in the West, owing to 
the high price of wool and mutton. 

In the last four years the number of sheep has declined 25 per 
cent, and their value has declined 70 per cent. The decrease in 
the production of wool in this country in the last 30 years has been 
20 per cent, while the population of the nation has greatly in¬ 
creased. 

Sheep raising is principally carried on at the borderlines of civili¬ 
zation. As civilized life encroaches upon the pasture lands, the 
flocks are driven gradually farther and farther into hitherto un¬ 
inhabited regions. The population of the world is steadily in¬ 
creasing, and the available grazing acres are constantly being 
reduced as the world becomes more thickly populated. Also, as 
the population increases, the demand for clothing and food in¬ 
creases, so that, on the face of it, it would seem that the production 
of wool would decrease while the demand grew constantly larger. 
In a measure this is true; but there are several factors which tend 
to arrest this Malthusian specter. In the first place, there are 
still vast areas of desert land which can be reclaimed for grazing 
purposes. In the second place, the growing of wool in most coun¬ 
tries is as yet practiced on a very crude and consequently uneco¬ 
nomical scale. And, finally, the use of shoddy and wool regained 
from rags has only begun to be developed. Nor is it true that 
sheep must necessarily be raised in uncultivated regions; England, 
with her closely settled soil, supports about three-fifths as many 
sheep as the United States, on an area of only 121,377 square miles, 
as against the 3,026,789 square miles in this country. 

Methods of Selling Wool. Roughly speaking, there are seven 
ways in which the wool grower may dispose of his fleece wool: 

1. He may sell it to buyers representing merchants. The mer¬ 
chant, while he is a middleman, performs a variety of very essential 
services. At the time of the clip he sends his buyers to the wool- 
producing centers and buys the clip for cash. He then ships it 


328 ECONOMICS OF CLOTHING AND TEXTILES 


to his warehouse, grades it, and sells to the mills on credit. Ob¬ 
viously he finances a very important part of the production, and 
is furthermore essential because he knows the demand, which the 
wool-grower does not, and the supply, of which the mill is usually 
ignorant. 

2. The wool grower may also sell to buyers representing mills. 
He prefers to do this because he eliminates the merchant’s profit, 



Wool Market at Buenos Aires 


but as a matter of fact, there are very few mills large enough to 
stand the buying expense, and even fewer that can afford to buy 
their whole season’s supply of raw material at one time and for 
cash. Also, most mills can use only certain grades of wool. 

3. If the grower thinks that he is not receiving fair offers from 
the visiting buyers, he will frequently consign his wool to a mer¬ 
chant to be sold on commission for his account. In this case he 
may or may not get a better price, but the selling costs him his 
carrying charges plus the commission of the merchant. There 
are some wool houses that make a specialty of executing commission 
sales of this nature. 

4. Some wool is sold direct to near-by mills. This is done par¬ 
ticularly in Ohio, where many of the smaller mills obtain their 
entire requirements in this manner. 

5. Wool growers sometimes sell to local dealers. This practice 
is particularly prevalent in regions where the individual grower’s 
production is small. In most eastern states there are a great 








BUYING AND SELLING 


329 


number of farmers who grow a small amount of wool. The local 
dealers are in many cases also the general storekeepers. Since 
they are the farmer's creditor on other merchandise, and since 
the average farmer knows very little about the grades of wool, 
these dealers frequently make a handsome profit when they sell 
to the visiting buyers. 

6. Some wool is sold through farmers' cooperative sales agencies. 
But these organizations have in the past been so poorly admin¬ 
istered, as a general rule, that they have not been successful. 

7. Finally, there remains the method whereby almost all the 
British and colonial wools are sold — namely, by auction. Auction 
sales have been established for almost a century in London, Liver¬ 
pool, Antwerp, Bremen, Hamburg, Marseilles, and recently in 
Australia. This method of disposing of their raw product does 
not, however, appeal to the American growers, because of the 
inherent American trading instinct. It is also not very feasible 
in this country, because the wool is not graded in the shearing 
sheds and because sheep-raising is not standardized. 

On account of the careless method of growing and packing in 
the United States, no one cares to purchase wool at auction in this 
country, as is done in other parts of the world. As a result a 
middleman, called the wool merchant, buys the wool and attempts 
to classify it and then sells direct to the mill. It is true that some 
of the large woolen mills, such as the American Woolen Company, 
have large staffs of wool buyers who buy direct. Boston is the 
wool center of the United States and the second largest wool 
market of the world. Nearly two-thirds of both domestic and 
imported wools used in this country are handled through Boston 
markets. The bankers in Boston are more liberal to the wool 
merchants than are the bankers in New York City, hence the wool 
market tends to remain there. Other wool markets are Phila¬ 
delphia, Chicago, and St. Louis. 

Prices of wool in England are governed by the prices obtained 
for the raw wool at the auctions at the end of the wool season, 
when the raw wool that has been clipped and packed has been 
sent to the warehouses. In the United States wool buyers go to 
the warehouses in the West, and after examining the wool offer a 
price. 


330 ECONOMICS OF CLOTHING AND TEXTILES 


Wool is sold at London and at Bradford, England, in April of 
each year. The wool is exposed attractively during the auction. 
The following gives a list of sales and prices for 1932: 

Offerings totaled 12,160 bales, making a total of 82,000 cata¬ 
logued during the series. Estimated purchases were: Home, 
38,000; Continent, 32,000. The 97,000 bales held over included 
88,500 bales that were unoffered. Compared with March, merinos 
and fine greasy crossbreds ranged from par to 5 per cent lower, 
medium and coarse crossbreds 5 per cent lower, and slipe crossbreds 
5 to 7| per cent cheaper. Cape wools were 5 per cent lower com¬ 
pared with March and Puntas fine greasy crossbreds were par to 
5 per cent lower, while inferior wools were 5 to 10 per cent lower. 
Sales at pence per pound were: 


Origin 

Sydney. 

South Australia 
New Zealand.. 

Cape. 

Puntas....... 


,—Merinos—» 

Sales Scoured Greasy 

484 . 7f-lld 

413 . 8f—114 d 

5,248 . 

760 8-11 d 4-8f d 

5,036 . 


,—Crossbreds—. 
Scoured Greasy 


. 4-8 d 

’. 5T-io|d 


Cooperative marketing offers more protection for wool growers 
during a depression period than at any other time. The National 
Wool Marketing Corporation has 35,000 grower-members. 
Heavy tonnages of cheap cash wool are deterimental to the mar¬ 
ket at a depression period. 

At this time the cooperative association is making advances in 
some States on the basis of advancing 75 per cent of the value of 
the wool to members. Advances already have been made on 
several million head of sheep in the principal wool-producing States. 

Kinds of Wool. It would not be possible to give in detail the 
various breeds of sheep existing in different countries. Merino 
sheep are now bred in many parts of the world, and, together with 
the high crossbreeds, are the source of all the fine wools known as 
merino, half-blood, and three-eighths wools. Long wools are 
derived from various native breeds, chiefly English, and from the 
lower crossbreeds of merinos, such as quarter and low quarter 
bloods. Chinese, Siberian, and Turkish wools, as well as many 
other uncultivated or non-domestic types, are usually very long 
and coarse, and are known as carpet and braid wools. 





















BUYING AND SELLING 


331 


Most of the best merino wools come from Australia, the next best 
from South Africa and from South America. The latter have one 
fault in that they contain many spiral burrs, which are difficult 
to remove and which frequently get through the machines and 
show up as imperfections in the cloth. Europe grows some very 
fine short wools, but these scarcely ever leave the countries where 
they are grown. 

United States wools are known as “domestic” and “territory.” 
Domestic wools are those grown in the eastern and middlewest- 
ern States, notably in the Ohio valley. These include the highest 
grades of merino Wools grown in this country. It must be remem¬ 
bered that sheep raising began in the East and, as civilization 
expanded, was gradually crowded farther and farther westward. 
The opening of the Erie canal in 1825 made available the fertile 
pasture lands of the Ohio valley. The Ohio canal eight years later 
opened up still more territory, and in 1849, during the famous gold 
rush, sheep were first taken to California. 

The territory wools are those grown in the Rocky Mountain 
plateau states. Recently, with improved methods and greater 
care in breeding, some very fine wools have come from Idaho, 
Wyoming, Nevada, and Montana, and from a few other States. 
The Texas and California wools are usually classed separately, 
because they are in most cases clipped twice a year. 

Wool before it is scoured contains a large quantity of yolk, or 
natural grease, besides dust and vegetable matter, and a consider¬ 
able amount of dried perspiration, or suint. The amount of weight 
lost through the removal of these substances when the wool is 
scoured is termed shrinkage. It will be readily appreciated that 
this is a very important factor in connection with the purchase of 
grease wool. The shrinkage varies from 20 per cent to 80 per cent. 
Nevertheless, a good buyer will often be able to estimate within 
one or two per cent. The factors to be considered in this connec¬ 
tion are the breed, the soil, the climate, and the care with which the 
sheep are raised, as well as the diligence with which the fleeces 
are prepared for market. Fine wools always shrink more heavily 
than coarse wools; and pulled wools, since they are washed and 
brushed during the process, show a very much lower shrinkage than 
fleece wools. The average shrinkage of United States wools is 


332 ECONOMICS OF CLOTHING AND TEXTILES 

about 55 per cent. Fine domestics shrink about 60 per cent; 
lower grades about 45 per cent. Fine territory wools shrink about 
65 per cent; lower grades about 55 per cent. Pulled wool averages 
about 27 per cent shrinkage. Fine Australian wools average 
49 per cent; although they are the finest, the fleeces contain less 
dirt. Cape wools shrink about 62 per cent, and South American 
about 51 per cent. 

Financing of the Wool Trade. From the banker’s point of view 
thereare many distinctive features of the wool trade which exercise 
an important bearing upon the judgment of a credit risk. To begin 
with, we find that in many instances the large raisers of sheep 
have built up their own banks. In Texas, for instance, there are 
a number of banks whose chief business consists in financing the 
wool clips of their sections. At the other extreme, we have the 
small grower of the East, who is frequently at the mercy of the local 
storekeeper. Where the wool growing is practiced on a large scale 
in this country, the tendency is to reduce the business to a scien¬ 
tifically standardized scale, similar to Australia. The more this is 
done the more independent the grower becomes, and the easier it 
is for a bank to determine the strength of the individual risk. 
The sheep raiser has, of course, one primary asset his flocks; 
and if he is compelled to borrow, the security behind his note rests 
upon his sheep. In making a loan to a sheep man, a bank has to 
consider not only the market value of the animals, but the condi¬ 
tions under which they are being raised. Sheep are affected by 
droughts, for instance, and many flocks have been ravaged by 
predatory animals or decimated by disease. Any one of these 
contingencies may at any moment destroy or depreciate the bank’s 
collateral, and for this reason borrowing of this sort is confined 
very largely to banks situated in sheep-growing sections, which 
specialize in this form of loan. 

It would be of great interest to figure the average cost of produc¬ 
tion per pound of wool to the grower, but, with the varying condi¬ 
tions encountered in different parts of the country and with sundry 
breeds, an accurate estimate can hardly be arrived at. Even 
the cost of shearing is variously figured from ten to nearly thirty 
cents. Generally speaking, however, the grower needs very little 
financial assistance, because he is able to sell his entire clip for cash. 


BUYING AND SELLING 


333 


The buyers representing merchants — or in a few cases, mills — 
are prepared to pay cash for their wool, and in some cases where 
they feel sure of a rising market, often go so far as to buy the wool 
on the sheep’s back before it is shorn. Provided the grower knows 
something about wool and the existing demand, there is no reason 
why, from the proceeds of one clip, he should not be able to meet 
his costs up to the time of the next shearing. 

The merchant has a very different problem. As we have seen, 
he buys for cash, and not only sells on credit, but carries a large 
proportion of what he buys for several months before he can dispose 
of it. There are so many kinds of wool merchants that it is almost 
impossible to make any general observations. One merchant, 
for example, may specialize entirely in domestic wools; in that 
case he would do all his buying in the spring months, and would 
gradually dispose of his material, having first graded it, during the 
remainder of the year. Another house might do the bulk of its 
business in South American wools, which would mean a fall purchas¬ 
ing season. Still another would handle both domestic and South 
American, and a fourth might import from all parts of the world, 
so that buying and selling would be going on continuously through¬ 
out the year. The credit requirements of the first two houses 
would be an easier demand upon the bank than those of the latter, 
but in all cases the judging of the risk involves several primary 
considerations, each of which really necessitates the close study of 
the individual case. 

A wool merchant’s business is largely based on his estimate of 
the future. Were it not for the fact that he assumes a risk which 
neither the grower, nor, in most cases, the manufacturer, is able to 
take, he could not maintain his position as the middleman. The 
merchant’s buyer must, as we have seen, be able to judge the 
amount of shrinkage within a very small fraction; he must know 
the demand for each quality of wool so that he may be sure not to 
pay more than he can sell for; and, what is more, he must be able to 
forecast the future with a certain amount of accuracy in order to 
make his profit. Furthermore, the merchant must be constantly 
on his guard against doing more business than his capital warrants, 
while at the same time, unless he makes every dollar work, his 
business will in normal times fail to show him a profit. 


334 ECONOMICS OF CLOTHING AND TEXTILES 

Some wool dealers have become considerably more than middle¬ 
men, and have gone quite extensively into the first stages of manu¬ 
facture. This is particularly true of some of the large houses, 
which of recent years have established top manufacturing depart¬ 
ments, and therefore sell a large proportion of their goods not as 
raw wool but as tops and noil. 

Although the dealers do the bulk of the commission work in 
consignment sales, there are many brokers whose function is 
primarily the buying and selling for the accounts of others. These 
houses usually operate with a limited capital and are not extensive 
seekers of credit. 

Quotations on Wool Tops Futures 

Wool for worsted fabrics is combed to remove the short fibers or waste, 
called noils. The combed wool is called top. 


Previous 



Opening 

Closing 

closing 

April. 

. 62.00-. . . . 

62.00-. . 

62.50-.... 

May. 

. 63.00-64.00 

1 63.00-.. 

.. 1 63.50-.... 

June. 

. 63.00-64.00 

1 63.00-.. 

. . 1 63.50-.... 

July. 

. 63.00-64.00 

1 63.00-. . 

.. 1 63.50-.... 

Aug. 

. 63.00-64.00 

1 63.20-. . 

. . 1 63.50-.... 

Sept. 

. 63.00-64.00 

1 63.20-. . 

.. 1 63.50-.... 

Oct. 

. 63.00-64.50 

1 63.50-.. 

.. 1 63.50-.... 

Nov. 

. 63.00-64.50 

1 63.50-.. 

. . 1 63.50-.... 

Dec. 

. 63.00-64.50 

1 63.50-.. 

.. 1 63.50-.... 

1933 — 




Jan. 

. 63.50-64.50 

1 63.50-.. 

.. 1 63.50-..'.' 

Feb. 

. 63.50-65.00 

1 63.50-. . 

1 63.50-.... 

High and 

low: July, 63.00-63.00; 

October, 63.50- 

63.50. 




Boston spot market, 69.50. 



Antwerp prices (pence and eighths per pound): 




Prev. 




Close close 

May. 



. 21i 21* 

July. 



. 21f 22 

September. . 



. 22 22\ 

December. . . 



.22 

Roubaix-Turcoing prices (francs and centimes per kilo): 




Prev. 




Thurs. 



Opening 

Closing close 

May. 



18.80 18.80 

July. 



19.00 19.00 

September... 



19.20 19.20 

December. . . 



19.50 


1 Nominal. 





























BUYING AND SELLING 


335 


1 Wool and Substitute Quotations 


Ohio, Pennsylvania and West Virginia 


Fine delaine.49-50 

Fine clothing.38-39 

i blood.50-51 

t blood.52-53 

i blood.52-53 

California 
0 Scoured Basis) 

Northern, 12 mo.1.12-1.15 

Southern, 12 mo.93- .97 

Texas 

0 Scoured Basis) 

Fine 12 mo.1.15-1.18 

Fine 8 mo.1.09-1.12 

Pulled — Eastern 
0 Scoured Basis ) 

A.A.1.15-1.20 

A-Super.1.05-1.08 

B-Super.93- .98 

C-Super.83- .87 


0 Scoured Basis) 

Staple fine.1.17-1.20 

Do. ibid.1.12-1.15 

Fine & fine medium.1.08-1.10 

f blood.1.02-1.05 

\ blood.95- .98 

Mohair — Domestic 

Best combing.75-78 

Best carding.50-55 

Wool Waste 

Lap — 

Fine white.1.23-1.25 

Fine colored.92- .95 

Thread White Worsted — 

Fine.93- .95 

i blood.83- .87 

f blood.73- .75 

£ blood.63- .65 

Thread Colored Worsted — 

Fine Two-ply.36- .37 

ijblood, Two-ply.30- .33 

f blood, Two-ply.28- .30 

i blood, Two-ply.25- .28 

Card — 

Fine white.53- .57 

Medium white.35- .37 


Mohair — Foreign (In Bond ) 


Turkey Fair average.48-50 

Cape Firsts.50-52 


Foreign Clothing and Combing 
(In Bond) 

Scoured Basis — 

Canadian: 

Alberta F & F medium.. .1.10-1.12 
Cape: 

Super 12 months.1.08-1.10 

Super 10-12 months. . .1.02-1.05 
Australian: 


70s.1.15-1.18 

64s.1.02-1.05 


58-60s. 

.90- .92 

Grease Basis — 

Montevideo: 

58-60s. 

...53-54 

56s. 

...51-52 

50s. 

...49-50 

Buenos Aires: 

4s, 40-44s. 

...37-38 

5s, 36-40s. 

...35-36 

Foreign Carpet 

(Grease Basis in Bond) 

China: Combing No. 1. 

...25-26 

China Filling Fleece. 

...23-24 

Szechuen ass’t. 

...23-24 

Cordova. 

...24-25 

Scotch Black Face. 

...25-26 

East India: Kandahar. 

...37-39 

VicanT. 

...40-44 

Joria. 

...43-48 

Aleppo. 

...36-37 

Old Woolen Rags 

Merinos — 

Coarse light. 

. 6*- 7 

Fine dark. 

. 4*- 5 

Fine light. 

.14 -15 

Serges — 

Blue. 

. 6|— 7 

Black. 

. 6*- 7 

Red. 

.144-15 

Knit — 

White. 

.41 -42 

Red. 

• 14^—15 

Light hoods. 

.20 -21 

Worsteds — 

Light. 

. 74- 8 
. 7f- 8 

Blue. 

Black. 

.6-64 


1 See author’s trade edition of Textiles for explanation in detail of terms. 


































































336 ECONOMICS OF CLOTHING AND TEXTILES 


Wool and worsted yarn quotations are published in the trade 
papers from day to day. 


Tops — Boston 

Fine. 

Half-blood. . . 
High f blood. 
Aver, f blood 
Low f blood. 
High ^ blood. 

48s N. Z. 

46s S. A. 

44s. 

40s. 

36s. 


Top and Noil Quotations 


(64-66s) $1.45 

. (60-62s) 1.35/ 1.37 
. .(58s) 1.28^/1.30 

. ..(56s) 1.23^/1.25 

.1.17^/1.20 

...(50s) 1.15 

.1.08/ 1.10 

. 1.05 

. 1.00 

.921 

.921 


Tops — Bradford, Eng. 

Fine. 

Fine. 

Half-blood. 

Half-blood, low.. . . 
Three-eighths blood 

Quarter-blood. 

Cross-bred. 


(70s) 

(64s) 

(60s) 

(58s) 

(56s) 

(50s) 

(46s) 


57d 

55id 

53M 

47ld 


43d 

34d 

27d 


Noils — Boston 

Fine. 

Half-blood. . . 
High | blood. 
Aver, f blood 
Low | blood. 
High 1 blood. 

46s. 

44s. 


$.95-$. 98 
.85- .90 
.75- .80 
.65- .70 
.60- .63 
.60- .62 
.53- .55 
.50- .52 


Worsted Yarn Quotations 


Bradford System 

2-12s, low com. (36s). 1.10-1.15 

2-16s, low com. (36-40s). 1.15-1.20 

2-20s to 2-24s, low * (44s). 1.30-1.35 

2-20s to 2-26s, * bid. (46-48s).. 1.37*-1.42* 

2-26s to 2-30s, * bid. (48s). 1.45-1.50 

2-30s to 2-32s, * bid. S. A. (46s) 1.50-1.55 


French System 

high, 20s, * bid. (50s). 

20s, f bid. (56s). 

26s, | blood (56s). 

30s, * bid. (60s). 

30s fine warp (66-70s). 

40s, * bid. (60-64s). 

50s (66-70s). 

60s (70s). 


1.50 

1.57* 

1.62* 

1.77*-1.80 
1.87*-1.92* 
1.95-1.97* 
2.12*-2.17 * 
2.62-2.72 


2-32s, * bid. (48-50s). 1.55-1.57* 

2-20s, | bid. (56s). 1.57*-1.60 

2-26s, f bid. (56s). 1.62 *-1.65 

2-36s, f bid. (56s). 1.67*-1.70 

2-32s, * bid. (60s). 1.75-1.77* 

2-36s, * bid. (60s). 1.80-1.82* 

2-40s, * bid. (60s). 1.85-1.87* 

2-50s, high, * bid. (64s). 2.00-2.05 

2-50s, fine (66-70s). 2.07-2.12 

2-60s, fine (70s). 2.60-2.65 


Knitting Yarns in Oil ( Bradford ) 


2-20s, low, * bid. (44s). 1.25-1.30 

2-18s to 2-20s, * bid. (50s). 1.42*-1.45 

2-26s, * bid. (50s). 1.47 *-1.50 

2-30s, * bid. (50s). 1.52*-1.55 

2-20s, | bid. (56s). 1.57*-1.60 

2-20s, * bid. (60s). 1.75-1.80 

French Spun Merino White 

308,50-50. 1.35-1.37* 

30s, 60-40. 1.45-1.47* 

308,70-30. 1.55-1.57* 

30s, 80-20. 1.65-1.67* 




























































BUYING AND SELLING 


337 


So far as the manufacturers or mills of various sorts are con¬ 
cerned, there is one striking difference between the commercial 
paper of woolen and worsted mills and that of cotton mills, which 
appears in the open market; cotton mill paper, except in the case 
of the strongest mills, usually bears the endorsement of the com¬ 
mission house which sells the mill’s product, but this is not as a 
rule the case with woolen and worsted mill paper. The reason is 
that a large number of the wool manufacturing establishments 
sell direct to wholesalers and jobbers, and have no close affiliation 
with a selling house. 

Trade terms vary a good deal. Raw wool is almost invariably 
sold for cash by the grower. Dealers make various terms to mills, 
the most usual being 1 per cent ten days, sixty days net. The 
terms on which mills sell to jobbers also have a wide range; some 
sell thirty days net, some 10 per cent thirty days, others 7 per cent 
four months. 

Marketing Silk. Silk is bought and sold in the raw condition, 
and as yarn and cloth. A knowledge of the technical terms of 
different kinds of silk will assist in understanding quotations. 

The raw silk, having been reeled and twisted into skeins, is next 
marked and tied together in bundles of skeins known as “books,” 
each bearing the mark or “chop” of its grade. These are packed 
in bales for shipment, the weight of the bales varying in different 
countries. In Japan and China they are called picul bales and 
weigh 133£ pounds. Italian silks, on the other hand, are packed 
in shipping bales of about 200 pounds. 

Of the countries producing raw silk, Japan and China occupy 
the leading positions by a large margin, the former contributing 
about one-half of the world’s supply, and the latter about one- 
third. Italy supplies about one-tenth of the total supply, and 
France, the Near East, India, Spain, and the Balkans contribute 
the balance. 

Although the greater part of the raw silk produced in the various 
countries is exported for manufacture abroad, a certain percentage 
is retained for home spinning and weaving. It is estimated that 
about 65 per cent of the Japanese output is exported, approximately 
90 per cent of which goes to the United States. In China over one- 
half of the output is held for domestic consumption, the remainder 


338 ECONOMICS OF CLOTHING AND TEXTILES 

being divided about equally between Europe and America. The 
Italian raw silk — a very high quality product — finds its largest 
market in France, principally in the city of Lyons, the silk center 
of Europe. 

The principal raw silk markets of the world are Yokohama, 
Lyons, New York, Milan, and Canton. Of these, Yokohama is 
probably the largest and most important, because of the pre¬ 
eminent position of Japan in raw-silk production. 

The Yokohama Raw Silk Exchange operates on a basis similar 
to that of the various cotton exchanges, and transactions are carried 
on in futures as far ahead as five months. The speculative element 
is very active, and its influence is often felt extensively throughout 
all phases of the industry. On several occasions it has been neces¬ 
sary to close the exchange to avert real disaster after the quotations 
had been manipulated to an unbelievable extent. During the last 
few years the Japanese government and various silk organizations 
have, by law and regulation, succeeded in improving this situation 
to a great degree. The benefit has been felt throughout the 
industry. 

Raw silk is sold by weight — in Yokohama, by net weight, that 
is, less wrappings, etc. In most countries it has been the custom 
of recent years to deal by conditioned weight. As a result the 
conditioning process has become an important side line in the 
industry. 

Conditioning is desirable principally on account of the fact that 
raw silk absorbs considerable moisture. A careless buyer may find 
after delivery that he has purchased more water than he has silk. 
To avoid this possibility, Asiatic and European markets have 
adopted the conditioned weight basis — absolute dry weight plus 
11 per cent moisture. Quotations are often given on invoice 
weight, which is conditioned weight plus a 2 per cent margin for 
variation. 

A conditioning house, besides examining for weight, conducts 
numerous other tests. The main factors considered besides weight 
are size, color, cleanliness, boil-off, winding strength, elasticity, 
and general uniformity. 

As regards size, the unit is the denier, an ancient French weight 
equal to .05 gram; the size is measured by the weight in deniers 


BUYING AND SELLING 


339 


of 450 meters of the thread. The 13/15 denier size is the stand¬ 
ard used in the United States, although the larger and smaller grades 
are dealt in to some extent for special types of products. Size is 
always given as averaging between two certain deniers (such as 
13 to 15), as it is impossible to attain absolute accuracy in reeling, 
and slight variations can not be avoided, either within the bales 
or within the skeins themselves. 

The color test is concerned merely with uniformity in shade, 
which makes accurate dyeing possible. The cultivated silks are 
either pure white or yellow, according to the variety of cocoon from 
which they are derived. 

The term “boil-off ” refers to the amount or percentage of gum 
on the filament. The individual strands of fiber adhere through 
a gummy substance secreted by the worm. The amount found in 
the reeled silk varies from 10 to 25 per cent, by weight. This is 
brought down to a minimum by the boiling process. 

Winding strength is measured by the breaks that occur in 
winding. In this country the test is based on the number of breaks 
occurring in thirty or more skeins wound at the rate of about 120 
yards per minute. This test is extremely important, since a weak 
thread can do much to hinder an efficient re-reeling process, inas¬ 
much as each break stops the machine and must be tied by the 
operator. 

Grading and Quotations. The classification of raw silk for 
market and the various terms used for its purchase and sale are 
quite complicated. Standardization has been sought for a good 
many years, and committees both here and abroad have studied 
the problem on various occasions, but without entirely satisfac¬ 
tory results. The chief source of trouble appears to lie in the many 
types of variation that may occur, not only on account of the great 
number of qualities required in the product, but also because of 
the varying conditions under which the silk is produced. In the 
early days of the industry, when farm production was the chief 
source of supply, particularly in Japan and China, satisfactory 
grading was almost impossible. However, now that sericulture 
and reeling have come more and more into the hands of the large 
companies and filatures, a greater degree of standardization can be 
reached. 


340 ECONOMICS OF CLOTHING AND TEXTILES 

The following is a copy of a recent quotation list in the New 
York market as it appeared in a commercial paper: 


Japan 

(Ninety Days’ Easis, 13-15 Denier) 


Kansai Double Extra Cracks.$6.15 @ $6.20 

Kansai Double Extra “A”. 6.05® 6.10 

Kansai Double Extra “B”. 6.00 @ 6.07 

Kansai Best Extra. 5.95 @ 6.02 

Kansai Extra. 5.90 @ 5.97 

Kansai Best No. 1 to Extra. 5.87 @ 5.95 

Kansai Best No. 1. 5.85 @ 5.92 

Kansai No. 1. 5.82 @ 5.90 

Sinshiu No. 1. 5.77 @ 5.58 


Canton 

(Ninety Days’ Basis) 

King Seng gr. 14-16.$6.40 

Favorite — Double Extra 20-22. 6.00 

Favorite — Double Extra 22—26. 5.90 


Shanghai 


(Ninety Days’ Basis) 

CHINA STEAM FILATURE 

Gold Double Deer, new crop.$7.50 

Geranium, new crop. 7.25 

Comet. 6.60 

Tsatless Blue Dragon and Flying Horse. 5.60 

Black Lion, No. 1-2. 5.10 

Tussah — Best chops. 3.90 


Italian 


Grand Extra Classical.$7.00 

Extra Classical. 6.80 

Best Classical. 6.70 


In the Japanese classification, the terms Kansai and Sinshiu 
originally indicated the sections of Japan where the silk originated, 
but of recent years they have come to mean hard or soft natured 
silks, respectively. The Sinshiu No. 1 is usually considered the 
standard quotation to use in judging the market trend. 

The Chinese quotations are probably the most difficult to 
understand, since they go almost entirely by “chop” — that is, 
well-known brands which are marked in some distinctive way, as 
shown on the above list of quotations. 

Marketing Thrown and Spun Silk. Thrown and spun silk are 
bought and sold in very much the same way as is raw silk, although 
the market is not so extensive nor is the volume of trading as large. 



























BUYING AND SELLING 


341 


The following tables of quotations are from a recent silk journal. 
A comparison with the previous quotations will show the apprecia¬ 
tion in value of the various gradings through the throwing and 
spinning processes. 


Quotations on Thrown and Spun Silk 


Thrown Silk 

Organzine 

Double Extra Crack.$7.30 

Double Extra. 7.20 

Extra. 710 

Tram 

Extra.$6.85 

Best No. 1. 6.75 

Kansai No. 1. 6.70 

Japan Crepe Twist, 2 thread, 75 turns.'.. . 7.80 

Japan Cr6pe Twist, 3 and 4 thread, 60-65 turns_ 7.25 

Canton Crepe Twist, 3 and 4 thread, 60-65 turns.. . 7.20 
Hosiery Tram. 6.75 


6/2 

10/2 

20/2 

30/2 

40/2. 

50/2 

60/1. 

60/2 


Spun Silk 

2% net 30 days 

. $4.25 

. 4.35 

. 4.75 

. 5.15 

. 5.35 

. 5.50 

. 4.45 

. 5.60 


Raw Silk Exchange. The advantages that the cotton industry 
has long enjoyed through the establishment of cotton exchanges 
now accrue to the members of the silk industry through the estab¬ 
lishment of the National Raw Silk Exchange, Inc. 

Price fluctuations in silk during past years have been great, and 
the risk of loss from sudden changes is ever present. The owner 
of unhedged raw silk is exposed to the risk of loss over a period of 
possibly many months. The hazards which he faces are entirely 
beyond his control. Such factors as weather conditions in Japan, 
diseases of the silkworm, the number of egg cards available for 
hatching, economic influences affecting the financial condition of 
the silkworm raiser, political disturbances — all influence directly 
the course of silk prices. With the Silk Exchange in operation 
the importer may hedge his purchases of raw silk by a corresponding 
sale of futures, and thus be assured that he will make his trading 






















342 ECONOMICS OF CLOTHING AND TEXTILES 

profit. Similarly he may contract to sell silk which he has not yet 
purchased in Japan and insure himself against the risk of a price 
advance by immediately purchasing a future. Every dealer in raw 
silk may protect himself in like manner. The manufacturer may 


Trading Floor of National Raw Silk Exchange 

hedge by selling raw silk futures, when he buys his physical silk; 
then if prices decline, while he will receive a lower price for his 
finished goods, this loss will be offset by the profit realized on his 
future sale if the prices of raw material and finished goods move in 
substantial parity. The manufacturer, furthermore, may contract 
ahead for delivery of finished goods and by the purchase of futures 
make certain that his manufacturing profit will not be impaired or 
wiped out by a rise in raw silk prices before he obtains the grade he 
needs in the cash market. 

The peril attendant upon untoward price fluctuations is more 
imminent and of more frequent occurrence than any of the risks 
against which standard insurance policies are written. By thus 
making protection available to every member in the industry in 
whose hands raw silk remains for any considerable time, or who 
contracts for the delivery of finished goods before the raw product 



















BUYING AND SELLING 


343 


is bought, or who manufactures for stock, the National Raw Silk 
Exchange, Inc., offers a service which should prove of vital impor¬ 
tance. 

A Typical Transaction on the Raw Silk Exchange. Mr. Brown, 
a dealer in raw silk, decides to purchase fifty contracts of May silk. 
It is the month of January, and he telephones the commission house 
of John Doe & Co. to buy “fifty May silk” at the market. The 
order is entered in the books of John Doe & Co. and immediately 
telephoned to the Exchange. A direct wire connects the offices of 
John Doe & Co. with the Exchange floor. Around the floor of 
the Exchange are rows of telephone booths, which are leased by 
Exchange members and attended by their clerks. The clerk of 
John Doe & Co. takes down the particulars of Mr. Brown’s order 
and then hands the memorandum to Wilkins, John Doe & Co.’s 
floor broker. Wilkins at the ring hears May silk being offered at 
$5.00 and bids being made for May silk at $4.98. He instantly 
knows the actual market for May silk, viz.: $4.98 bid, $5.00 offered. 
The purchase is immediately made at $5.00 per pound. No 
writing is exchanged between the brokers, but the contract, made 
by word of mouth at the ring, is inviolable. As soon as the transac¬ 
tion has been made, a uniformed attendant at the ring signals the 
price and the amount of silk bought to the recording clerk, who sits 
on a bridge above the Exchange floor. The particulars of the 
transaction are recorded in the Exchange’s permanent records and 
at the same time relayed to an attendant at the blackboard which 
stretches across one wall of the trading room. The attendant 
promptly chalks up the particulars of the transaction. Thus the 
brokers at the ring have constantly before them a record of the 
day’s transactions, a glance at the blackboard at any time inform¬ 
ing them of the course of prices for each trading month. Simul¬ 
taneously with the recording of the transaction the ticker operator, 
also stationed on the bridge, flashes the price to his central office, 
from which it is instantly sent out to the tickers located in the offices 
of silk merchants and commission houses throughout the country. 

When the purchase has been made, John Doe & Co.’s attendant 
reports it back to his office by telephone. Within a short time 
after placing his order, Mr. Brown receives the confirmation and 
knows the price at which he has obtained his silk. 


344 


ECONOMICS OF CLOTHING AND TEXTILES 


Rayon Gray Goods 


All-Rayon Cr&pes 


Count 

Width 

Warp 

Filling 

18?-19 

80 X 40 

40| 

150-36 

100-40 

96 X 56 

42 

150-60 

100-40 

27 

96 X 48 

42 

150-40 

100-40 

24 

80 X 48 

40? 

150-36 

100-40 

19?-20 

114 X 64 

42 

100-40 

100-40 

30?-31 

120 X 68 

42 

100-40 

10(3-40 

32? 


Rayon-Filled Flat Crepes 
(45s Crepe Warp) 


76 X 60 

150-60 

111 

76 X 56 

150-60 

10 ! 

76 X 48 

150-32-40 

9-9! 

76 X 52 

150-32-40 

10 

68 X 50 

35-inch Mock Crepe 

7! 

68 X 48 

35-inch Mock Crepe 

7-7! 


Twills and Taffetas 

(First quality warp, second quality filling.) 


88 X 44 39-in. 150 den. twill 17-17? 

88 X 44 35-in. 150 den. twill 16? 

80 X 36 36-in. 150 den. taffeta 14 

92 X 40 35?-in. 150 den. taffeta 17 

84 X 60 all-rayon taffeta 20? 

76 X 52 all-rayon taffeta 17? 

114 X 52 39-in. 150 den. warp 

3-thread 13-15 Japan 
tram fill., twill 20 ? 

120 X 52 39?-in. 150 den. warp, 

3-thread 13-15 Japan 

tram fill., twill 21 f -22 

Rayon Georgettes 

64 X 56 43-44-in. 24|-25 

Voiles 

60 X 54 35?-in. 75 den. rayon 15?-16 


Rayon , Cotton Serges, Poplins 


80 X 56 36-in. 30s K. warp, 

150 denier filling.12?-12J 

120 X 56 37-in. 150 den. warp, 

60-2-ply mercerized filling.22?-23 

80 X 36 36-in. 150 den. warp, 

40-3-ply filling, poplin.cl7? 

74 X 36 36-in. 150 den. warp, 

40-3-ply filling, poplin.cl 6 J 


Plain Rayon Filled Goods 


60 X 40 carded warp 

65 

60 X 40 combed warp 

7-7! 

60 X 44 combed warp 

7! 

64 X 48 combed warp 

8 

64 X 52 combed warp 

Sf 

64 X 60 32-40 filament 

9-9! 

68 X 64 60 filament 

12 


Acetate Fabrics 

(All Acetate Prices Net) 
(150 Denier Warp and Filling) 


Twill 

112 X 72 37 Act. W. Ray. F 30J-301 

120 X 72 37 Act. W. Ray. F 32§-33 

Plain 

84 X 68 40?-41 Ray. W. Act. F 29-30 

84 X 68 41 Act. W. Ray. F 28f-29J 

84 X 72 40? All-Acetate 29§ 

84 X 60 All-Acetate taffeta 28f-29 

Voile 

64 X 64 39 75 denier 23^-24 

Ninon 

80 X 80 39 75 denier 29§ 


Plain Silk and Cotton 


35-in. Canton Filled 


Count Den. 
88 X 32 22-26 
96 X 64 22-26 
96 X 92 22-26 


Price 

7-7! 

8 


Count Den. Price 
96 X 100 22-26 12 

96 X 100i 14 -I 6 141 
22-26 17 


1 Two-End. 


Tussah Filled 

Wid. Count Price I Wid. Count Price 

34 80 X 56 11-12 | 35 96 X 96 19-20 

Legend—c Contract. 


The Clearing Association. When the day’s trading ends, the 
floor brokers gather around long tables, which are brought out on 
the Exchange floor, and exchange contract slips, which are con¬ 
firmation memoranda of the trades they have executed during the 
day. The seller signs the buyer’s slip and the buyer signs the 
seller’s. From these slips Exchange members who are also mem- 







BUYING AND SELLING 345 

bers of the National Raw Silk Clearing Association, Inc., make 
up their daily reports to the Clearing Association. 

The Clearing Association is an independent corporation, formed 
to clear trades for members of the Exchange who are also members 
of the Clearing Association. Exchange members who do not 
belong to the Clearing Association may clear their trades through 
Clearing Association members. The Clearing Association assumes 
and guarantees every contract which is cleared. It becomes the 
seller to every buyer and the buyer from every seller. When 
Brown’s contract to buy fifty May silk is cleared, John Doe & Co. 
and the house from which the purchase was made cease to deal with 
each other. The Clearing Association becomes the seller to John 
Doe & Co. and the buyer from the other party to the contract. 

Any member of the Exchange may become a member of the 
Clearing Association upon compliance with certain specific require¬ 
ments. Among other things he must deposit with the Clearing 
Association $10,000 as security for the fulfillment of all contracts 
which he offers for clearance. In addition he must deposit with 
the Clearing Association a fixed sum for each contract which he 
offers for clearance. He must keep good these deposits by further 
deposits to meet variations in the market price at any time during 
the day. Within one hour after demand is made upon him by the 
Clearing Association for additional margins to keep good his 
deposits, the Clearing member must respond; otherwise his con¬ 
tracts will be closed out. 

A small service charge is made for clearing each trade. Over a 
period of years these small charges accumulate into an impressive 
surplus, and this surplus serves to fortify further the guarantee 
of the Clearing Association. In the history of commodity ex¬ 
changes there is no record of the loss of a dollar by failure to fulfill 
a contract guaranteed by an exchange clearing association. 

Advantages of a Commodity Exchange. The advantages of a 
commodity exchange may be summarized as follows: 

1. It provides dealer and manufacturer with a means of insuring 
himself against the risks of price fluctuation in the raw commodity. 

2. It renders stocks of the commodities liquid. 

3. The ability to hedge and the liquidity of stocks greatly 
facilitate financing. 


346 ECONOMICS OF CLOTHING AND TEXTILES 


4. The improved facilities for financing permit dealer and 
manufacturer to do business on a larger scale and at a closer profit 
margin. 

5. By its contact with other markets and its widespread sources 
of information, the exchange concentrates and focuses world-wide 
price influences. 

6. The prices established on the exchange, representing a 
variety of standard grades, reflect the general trend of the whole 
market. 

7. The prices of contracts for future delivery serve as a guide 
and basis for spot dealings. 

8. The exchange, in cooperation with the industry, exerts its 
influence in the interest of uniform standards of inspection, grad¬ 
ing, and weighing. 

The Silk Exchange renders these services through operation of a 
continuous and broad market, one in which silk may be sold or 
bought at any time during any trading day, and one in which 
quotations for the delivery of silk, months in the future, are at all 
times available. 

Hedging. The most important service which an exchange offers 
to the merchant dealing in a world-wide commodity is the oppor¬ 
tunity to hedge. A hedge is a transaction by which a purchase or 
a sale of the physical commodity is offset by a sale or purchase of a 
future. The object is to free the hedger from the risk of adverse 
fluctuation in the price of the physical commodity. Let us say a 
dealer in New York purchases raw silk at a price of $5.00 per pound. 
He wishes to guard against incurring loss by a price decline before 
he sells his silk. Accordingly he sells a contract for future delivery 
on the Silk Exchange. Assuming that the sale is made at the same 
price he paid for his silk, he has opposite and equal commitments 
in both the cash and futures market. He disposes of his physical 
silk, perhaps at a loss, but he has gained exactly this amount on 
his sale in the futures market, and instead of a loss he has received 
insurance against loss. If the contrary movement should take 
place, and the price of raw silk advance, he would lose on the 
futures transaction but gain an equal amount on the increase in 
the price of the physical silk. In either case the transaction would 
be completed with his dealer’s profit intact. 


BUYING AND SELLING 


347 


The manufacturer who buys raw silk to make into stock or who 
buys in advance of orders may utilize the hedge in the same way, 
acquiring his physical silk in the outside market and immediately 
selling on the Exchange a like amount for future delivery. He will 
then be protected whichever way the price moves, and will be 
assured of his manufacturing profit. If the manufacturer has made 
a forward contract to deliver broadcloth requiring a specific grade 
of silk, he may obtain protection against a rise in the price of the 
silk to be manufactured into broadcloth by immediately purchasing 
exchange futures contracts for the amount of raw silk he will need. 
He thus obtains insurance against the loss that would be occasioned 
by a rise in raw silk prices, and when he obtains the specific grades 
of silk he wishes in the cash market he will close out his purchase 
in the futures market, and it will be a matter of inconsequence in 
which direction prices have moved. 

Skill and Experience Required in Hedging. Theoretically price 
fluctuations in a physical commodity and in futures have a parallel 
course. In other words, prices of the physical commodity move up 
and down in the same ratio as the prices of futures advance and 
decline. If this unison in price movements were the invariable 
rule, it would be possible always to obtain perfect protection by a 
hedge. However, the prices of the physical commodity and the 
futures prices do not always follow a parallel course, as is shown by 
price movements of commodities on many exchanges when com¬ 
pared with prices in the cash markets. This relationship of the 
price of the physical commodity to futures prices is known as basis. 
The perfection of the insurance which the hedge affords is largely 
dependent upon basis. Skill and experience should guide the 
hedger in avoiding the risks of lessened protection brought about 
by frequent changes in the basis. The selection of the month for 
placing the hedge, certain problems of switching, closing out the 
hedge, and other technical matters incident to hedging should be 
the subject of study and consideration by the careful hedger. 

The Exchange as an Aid in Financing. In the commerce of 
commodities for which exchanges have been long established, 
bankers are willing to make larger loans on stocks that are 
hedged than on stocks that are subject to the risk of loss by con¬ 
stantly occurring price changes. The hedging facilities afforded by 


348 ECONOMICS OF CLOTHING AND TEXTILES 


exchanges, therefore, not only protect against risk, but they also 
encourage sounder financing and make it possible for manufacturers 
and dealers to obtain better banking accommodations. In com¬ 
modities wherein hedging is possible through organized futures 
exchanges, hedging has been an important factor in enabling 
business to be done on a smaller capital than would otherwise have 
been possible. 

Quotations on Raw Silk Futures 

The local spot market for crack double extra advanced 
1 cent to $1.46. Closing prices were unchanged to 2 points 
lower, except August, which was 1 point higher. Total 
sales were 640 bales. Eighty per cent Seriplane silk in 
Yokohama advanced 10 yen to 510. Yen exchange 
declined to 33f^, closing with losses of from 11 to 22 yen. 

Total sales were 1,905 bales. 

Prev. 

Open High Low Close close 


April. 1.36 1.36 1.35 1.36 @- 1.38 

May. 1.33 1.36 1.32 1.36 @ 1.37 1.37 

June..1.35 @ 1.37 1.36 

July. 1.36 1.36 1.36 1.35 @ 1.37 1.36 

Aug. 1.37 1.37 1.37 1.37 @ — 1.36 

Sept..1.37 @ 1.38 1.39 

Oct. 1.37 1.37 1.37 1.37 @- 1.37 

Nov. 1.34 1.37 1.34 1.37 @- 1.39 


Successful Trading. The success of every business man, whether 
he is a merchant or a manufacturer, depends much upon his ability 
to buy not only at the right time but also at the low price. If we 
make an analysis of the experience and methods of men and women 
who are successful in buying wearing apparel, we shall find the 
following practices important: 

1. The buyer must always have on hand a proper supply of 
stock, not too much or too little. Too much not only involves 
unnecessary capital but also additional expense in carrying the 
excess stock, and too little means frequent shut downs and loss 
of sales, which involve much expense and loss of profits. 

2. A list of stock, called an inventory, should be kept. Past 
experience will show the greatest amount, called the maximum, 
and the least, called the minimum, of stock found necessary on 
previous occasions. Records of previous years kept on cards or 
expressed in curves (graphically) will tell the time of greatest and 












BUYING AND SELLING 


349 


least sales, and will also indicate the kinds of wearing apparel that 
move most quickly and those that move most slowly. 

3. The stock clerk or storekeeper in charge of the stock and the 
records must notify the buyer or business man when the supply 
reaches the minimum. When the buyer places the order, the stock 
clerk should report every day the condition of the supply, and also 
when the new wearing apparel or goods are received. In case there 
is a delay in shipping, a strike at the mill, or a break-down in 
the machinery, the buyer must be able to secure an emergency 
supply at short notice, so that no profits are lost through loss 
of sales. 

4. A successful buyer must know the wearing apparel he pur¬ 
chases, not only the steps in manufacturing but also the grades of 
raw materials and sewn and finished products. In fact, a good 
buyer should have spent some time in the field or factories securing 
information at first hand as to the cost of manufacturing and the 
competition so that he will know the actual cost of the product. 
A study of the Journal of Commerce, Women’s Wear, and other 
wearing apparel trade papers will keep one informed of the cost 
of raw materials and finished articles, etc. 

5. It is essential that the buyer should never pay too much, 
and that he should know the location of competitors and other 
markets, so as to secure the best prices on wearing apparel. 

6. There are two methods of purchasing — on name and on 
merit. Since the branded or named article is a monopoly, a lower 
price can be secured on the unbranded wearing apparel. But in 
order to buy on merit, the buyer must be able to set up certain 
specifications that experience has taught him, or that his customers 
demand, and know whether or not the articles measure up to the 
standard. Many concerns, like R. H. Macy & Company and 
other dry goods stores, have testing apparatus, and all wearing 
apparel is bought on specifications and samples are tested. 

7. Since the price of wearing apparel purchased by the buyer 
depends to some degree on the cost of raw materials, it is abso¬ 
lutely necessary for the buyer to become familiar with the market 
conditions of the raw materials, as well as labor and manufacturing 
conditions, so that he will gauge the future price trend of the 
manufactured wearing apparel that he is to buy. This means a 



Making a Microscopic Test of a Textile Fabric 
In a dry goods testing laboratory 

that later the price (in times of depression, etc.) has dropped one- 
half or one-third or less. Then when an inventory of the stock is 
made for the financial report to the bank or for the public, the 
stock on hand must be quoted at present, not past, prices, and 
often the firm shows a loss due to the depreciation in the inven¬ 
tory. Hence the success of a wearing apparel factory is due in 
no small measure to the ability to purchase at the right time and 
in the proper quantities, so that one can always secure stock at 
the reduced prices. 


350 ECONOMICS OF CLOTHING AND TEXTILES 


knowledge of the supply and demand of the future. Frequent 
market reports, government reports from the Bureau of Commerce, 
trade papers, etc., will provide much of this information. Many 
cotton manufacturers and silk manufacturers have purchased sup¬ 
plies of cotton and silk at the beginning of the year and have found 



BUYING AND SELLING 


351 


8. The buyer must know the financial condition of the firm, 
so as to know (a) how much to buy, ( b ) whether to purchase on 
cash or credit, and (c) the best time for payment. When the true 
financial condition is known, better buying judgment can be 
exercised. 

9. The location of all factories of wearing apparel should be 
known to the buyer, as well as the transit facilities and the factory 
conditions for sending out the stock. This is absolutely necessary 
in order that the buyer may make the proper purchases. If imper¬ 
fect goods, partially filled orders, and slow deliveries are common to 
the factory, then it can not be depended upon for emergency orders. 

10. Since all kinds of wearing apparel are more or less subject 
to style and are also seasonal in character, the buyer must be alert, 
familiar with style tendencies and reports from style centers, so 
that he may buy wearing apparel that will immediately sell, and 
not remain on hand. 

11. Wearing apparel is considered as of two types: (a) staples, 
and ( b ) novelties, fancies, or new staples. Standard products like 
blue serge, conservative styles of jewelry, etc., are called staples, 
and usually run from season to season. New staples or novelties 
contain many degrees of style and are subject to constant change. 
Hence the buyer’s ability is tested in the purchase of novelties or 
fancies, rather than staples. 

12. One of the greatest weaknesses of a buyer is overbuying or 
overstocking. The temptation may be due to a very attractive 
price, but the tendency must be carefully checked. Overbuying has 
caused more bankruptcy than any other single cause, because the 
stock must be paid for regardless of whether it is sold or not, and 
in order to dispose of a surplus it may be necessary to sell below 
cost. 

13. Every buyer must know intimately the class of people to 
whom he will sell. He must have their desires in mind when he 
buys. Frequently campaigns are conducted, particularly by retail 
stores, to secure a knowledge of the likes and dislikes of the con¬ 
sumers and the character of wearing apparel that will appeal to 
them. Salespeople are requested to keep a record of all requests. 

Every successful business man must not only know how to buy, 
but also how to sell. A careful analysis of business men who are 


352 ECONOMICS OF CLOTHING AND TEXTILES 

successful dealers in wearing apparel will show that success con¬ 
sists of: 

1. Very careful buying, low cost of production, and successful 
selling. The selling price must be equal to the total cost of raw 
material, cost of manufacturing, cost of selling, plus a profit. 

2. The plant for manufacturing must be located at a convenient 
spot, be well arranged and well equipped, efficiently managed, and 
of a size to meet the demands of the sales. 

Retail Selling. The retail stores, such as dry goods stores, 
haberdashery stores, etc., are in direct contact with the consumer 
and know his needs and wishes. They report these needs to sales¬ 
men representing the manufacturers or wholesalers. 

The prices of commodities in retail stores usually represent a 
50 per cent mark-up above the wholesale price. Sometimes the 
retail dry goods store will carry articles at no profit, and even at 
a loss, in order to attract customers, hoping that while they are 
purchasing the goods sold at no profit, they will become interested 
enough to purchase other articles that have the regular mark-up 
of 50 per cent or more. 

A 50 per cent mark-up on the wholesale price represents a 33-J- per 
cent profit on the selling price. To illustrate: If a suit manufacturer 
sells 100 suits at $15 less 10 per cent for immediate payment, the 
retail store pays $13.50. The mark-up is 50 per cent of the whole¬ 
sale price — $15 plus $7.50, or $22.50. The profit is considered to be 
$7.50. The discount of $1.50 is regarded as an office fund to pay 
for bookkeeping, etc., and is not considered part of the profit. 

At the end of the season, when the mark-downs take place, the 
sale price is usually one-third off the original price, or, in the 
example given, a mark-down of $7.50. The buyer then pays the 
cost price of $15. 

Sales of wearing apparel may be increased in two ways: (1) by 
lower prices, arrived at through decreased cost of manufacturing, 
elimination of waste, and more efficient methods, or (2) by attract¬ 
ing the attention of the public and causing it to increase clothes 
consumption. 

In times of depression, the retail stores that survive are those with 
the best organization and methods and the minimum waste. Those 
unable to meet competition are forced into the hands of receivers. 


BUYING AND SELLING 


353 


Competition is very keen in retail selling. While each store 
has a sales policy that may appeal to a certain group of consumers 
in the community, such as (a) the upper social classes, (6) the 




The low 
Mark¬ 
down 
Prices 
wherever 

you find 




Store Display Card for a Mark-Down Sale 


middle classes and professional people, and (c) the working class, 
nevertheless they all appeal to the marginal consumers of the group, 
who are always looking for “bargains,” i.e., a higher margin of 
utility. The competition for this group of buyers causes retail 
stores to make frequent comparisons of prices in other stores, and 
to try to attract this marginal consumer by advertising, service, 
window dressing, etc. Many stores have a group of clerks called 
comparison shoppers, who frequent the competing stores and report 
the prices for similar merchandise. The store may then change 
its prices in accordance with the reports of these shoppers, in an 
attempt to undersell competitors. The following announced 
selling policies of various stores illustrate this tendency: 


you DON’T HAVE TO PAY CASH! 


Do you want a new Fur Coat or Cloth Coat or 
Dresses? Come to BLANK FURRIERS’ Greatest 
August Sale . . . make your selections . . . pay a 
small deposit. . . take your purchases home with 
you . . . and pay for them while you are enjoying 
their use through the famous BLANK Unique 
Payment Club, the only one in New England! 

No delays, no investigation, no inconvenience! 

NO CHARGE FOR STORAGE ON FUR 

COATS OR CLOTH COATS PURCHASED NOW! 













354 ECONOMICS OF CLOTHING AND TEXTILES 


A Small Deposit Reserves Your Selection 

until wanted in the fall, then pay cash . . open 
a charge account . . or pay I/10 each month 
while wearing your coat on our convenient 

BUDGET PAYMENT PLAN 


We endeavor (though we are not infallible) to sell our merchandise at 
least six per cent cheaper than we could if we did not sell exclusively for 
cash. This is the keystone of the store price policy. 


It is the store’s endeavor to provide merchandise of 
quality, with courteous service and the convenience 
of charge accounts, at prices as low as they could 
be if we inconvenienced customers who prefer 
to charge by requiring currency on each purchase. 


EVERY-DAY 

MONEY-SAVING 

POLICY: 

Cuts the cost of every¬ 
thing you buy here! 

• NO Costly Fixtures 

• NO wasteful "services” 

• NO charge accounts 

• NO expensive "frills” 

• NO complicated systems 

• NO high pressure selling 

• NO elaborate showplaces 

BUT 

• A home-like common-sense 
store that saves you money at 
every turn 

• Operated on the principle of 
smaller expense, less profit, 
therefore lower prices 

• A clean pleasant store with a 
happy contented store family 
to help you 

• A store that is PROUD to be 
known as “the bargain store 
of America ” 


elbow room 


Wide aisles. 
Plenty of people in them, but no crowded 
feeling; a lot more elbow room than elbows. 
People behind the counters who seem glad to 
see you. (They are.) Things on the counters 
and in the cases that look as though they 
ought to cost more than they do. Good 
light—clear light; neither down-stage glare 
nor upstage mystery. Just a wide-awake 
and agreeable place to shop. (It even smells 
agreeable.) 


















BUYING AND SELLING 


355 


Installment Buying. The growth of installment buying is con¬ 
sidered by many persons as an abuse of business, particularly in 
the field of wearing apparel, which is not a long-time investment. 
Since wearing apparel is attractive to every one, there is a tempta¬ 
tion to buy on the installment plan more clothes than one can 



A Salesroom in an Up-to-Date Apparel Store 


afford. This is particularly true with regard to luxury articles 
such as fur coats and jewelry. 

Unless installment selling is considered from certain standpoints 
of service to the consumer, it is highly undesirable from an economic 
standpoint. In applying the test of service to the consumer in 
any particular case, the following is a composite of the standards 
of judgment suggested by those who have studied the problem with 
care. The article in question should be : 

1. In the class of necessaries of clothing or wearing apparel, 
or other commodity, rather than luxuries. 

2. Of sufficient value to be beyond the reach of the resources of 
the purchaser on the basis of cash or ordinary credit. 

3. Of sufficient permanence to outlast many times the period 
of payment. 

4. One which will not tax the purchaser beyond his resources for 
its upkeep. 

Most authorities agree that if these tests are satisfactorily 
met, the dangers of the installment plan will be avoided — for the 






356 ECONOMICS OF CLOTHING AND TEXTILES 

buyer, the seller, and the economic health of the nation as a 
whole. 

Effective Salesmanship. In analyzing the attitude and move¬ 
ments of a successful salesperson of wearing apparel you will find 
the following: 

1 . The salesperson notices an approaching customer and greets 
her with a pleasing, alert look, and at the same time observes the 


Expert Sales Service 

wearing apparel of the customer as well as her figure. The sales¬ 
person should be able to classify her customers as to style qualities. 

2. Salespeople should always appear busy, not gossiping with 
other salespeople, but studying the stock, arranging apparel, etc. 
As soon as a customer arrives, the attention should be centered 
on the customer. 



BUYING AND SELLING 


357 


3. A salesperson should know the selling points of the wearing 
apparel she is selling. These selling points should be expressed 
in simple, attractive, and not too common terms or phrases. It is 
a good plan to develop the sales vocabulary by trying to think of 
possible expressions relating to the wearing apparel, beginning 
with different letters. The good salesperson trys to avoid common 
expressions, such as “sweet,” “dear,” etc. 

4. Care of the stock — dusting, rearranging, and inspection — 
affords an excellent opportunity to become familiar with all kinds 
of merchandise. Stock should be kept in a fresh, attractive, salable 
condition in order to secure sales. Damaged, soiled, or dusty 
merchandise is never purchased, and does not add to the good name 
of the store. 

5. It is important to have a customer in a pleasing frame of mind. 
A tired, nervous, restless customer finds it hard to make a decision 
and leaves the store without buying. Hence the value of all 
conditions in the store conducive to ease, calmness, quietness, etc. 

6. A good salesperson of wearing apparel, after a careful style 
analysis of the customer, will find it is not necessary to show many 
garments before the sale is completed. 

7. The good salesperson does not antagonize customers with 
questions that create irritation or weariness. By presenting or 
showing the customer a series of garments suited to her, it is 
possible by her comments to secure her ideas on the apparel. 

8. One should be careful not to judge a customer exclusively 
by her style of dress. Many people consider simple dressing a sign 
of refinement and taste. 


QUESTIONS 

1. Compare the relative merits of the two common methods of exchange. 

2. Justify the economic existence of the middleman. 

3. Outline a typical organization for a mill-marketing department. 

4. Clearly define the function of the factor. 

6. Distinguish between a jobber, commission merchant, broker, 
converter, and wholesaler. 

6. What operations may a converter perform upon various textiles ? 

7. Clearly differentiate between the three basic methods of distribution. 

8. How may a buyer in Tulsa, Oklahoma, obtain information con¬ 
cerning the latest fashions in the eastern style centers? 


358 ECONOMICS OF CLOTHING AND TEXTILES 


9. What is meant by dry goods ? 

10. What are the advantages of selective distribution to the manu¬ 
facturer? 

11. In marketing merchandise what factors must be considered? 

12. What are the responsibilities of a trading agent? 

13. What qualifications must a buyer possess? 

14. How can the cost of distribution be reduced ? 

15. What factor determines the cost of selling? 

16. What does the term market mean ? 

17. How may a market be established? 

18. How are prices established? 

19. What evils may arise from a monopoly? 

20. What is meant by marginal utility f 

21. Describe the various grades of cotton as quoted in commodity 
markets. 

22. What is meant by “city crop”; by linters? 

23. What other factors are considered when raw cotton is purchased? 

24. Who are the various buyers of raw cotton? What service does 
each perform? 

25. Justify a true speculator. 

26. Distinguish between a speculator and a gambler. 

27. Defend trading in cotton futures. 

28. Detail the functions of each of the various channels through which 
cotton cloth is marketed from the mill. 

29. In what manner is wool marketed differently from cotton? 

30. How are American wools classified ? 

31. Clearly distinguish the various grades of wool. 

32. What is responsible for shrinkage in wool? 

33. In what way does the financing of the wool trade differ from 
the financing of the cotton trade ? 

34. What is meant by conditional weight ? 

35. How is silk measured as to size ? 

36. Explain the trading on the raw-silk exchange. 

37. What function does the clearing association perform? 

38. What does hedging consist of? Explain its importance in the raw 
textile field. 

39. What important factors govern success in the textile merchan¬ 
dizing field? 

40. Explain the common procedure followed in mark-up and mark¬ 
down in the average retail store. 

41. What are the characteristics of a successful salesperson? 


CHAPTER VIII 


INTERNATIONAL TRADE 

Definition. As the result of differences in geographic location, 
climate, and natural resources, we find that the products and 
industries of countries vary greatly. There is somewhat of a 
natural division of labor, by which each country develops the indus¬ 
tries and products most suited to the environment and to the 
workers. We have noticed a similar division of labor, in a more 
detailed form, in the development of specific trades and crafts as 
opposed to the older method of every man supplying all his own 
needs. A natural result of such specialization is a system of 
exchange, whereby one can dispose of his surplus product in 
exchange for the other commodities he desires. When such trade 
takes place within the confines of a single country, it is known as 
domestic trade. Exchange of products between different countries 
is called foreign trade. 

The products sent out from a country are called the exports of 
the country and those products brought into the country from other 
nations are called imports. In order that people of each country 
may share in the textiles produced all over the world, we find an 
extensive development of international trade in the various fibers, 
completed cloth, etc. Thus each country has, through special 
conditions (climatic advantages, standard of living, trained labor 
supply, etc.), tended to become more efficient in the production of 
one type of textile products. We find that Japan excels in the 
production of silk; Lancashire, England, excels in the production 
of fine cotton cloth; the United States and India produce most of 
the raw cotton used. 

Importance. Because of the special advantages of each country, 
competition from other countries is not effective with regard to 
these textiles. It is not easy to cause Japanese silk growers to 
migrate to England, and it is difficult, if not impossible, to repro¬ 
duce in Japan the climatic condition of natural humidity that 

359 


360 ECONOMICS OF CLOTHING AND TEXTILES 


makes Lancashire most suitable for the manufacture of fine cotton. 
Therefore it is not practical to raise silk in England or to make fine 
cotton in Japan. The countries are not in a position to compete 
effectively with each other; it is more profitable for each to 
specialize in the product best suited to its environment and labor 
supply. 

Again, the advantages of centuries of skill may give to one nation 
a superiority that cannot be overcome by another nation. Thus 



France has a style superiority in fabrics that it is impossible for 
other nations to meet on an equal price basis. This special advan¬ 
tage gives to France immense profits and effectively prevents 
competition in certain products. 

The Balance of Trade. As in all trade, we find that exchanges 
between foreign countries require that other commodities of 
equivalent value must be given in return for the commodity 
received. Thus the imports into any country must be paid for 
either by an equivalent value of exports or else by the payment of 
enough gold or silver to cover the difference in value. If a country 
exports more goods than it imports, we say that the balance of trade 
is favorable. That is, other countries must send either gold or 
silver in return for part of the goods they have received from that 
country. If the country imports more goods than it exports, then 
the balance of trade is unfavorable, and money must be sent out 
of the country to cover the deficit in the commodity values. 

Since the amount of gold in any country is limited, it is obvious 
that no country can continue indefinitely to import more goods 
than it exports. Such a condition would soon result in bankruptcy 
















































INTERNATIONAL TRADE 


361 


for the nation. Of course, the country may render part payment in 
the form of services — such as shipping, banking services, etc., — 
but ultimately the value of exported commodities combined with 
services rendered must be equivalent to the goods and services 
received from other countries. Thus every country must realize 
that in order to sell its products to other countries, it must be 
prepared to buy the products of those countries. Hence in 
America, we should become accustomed to and educated to the value 
of foreign-made textiles and cloth, and not be prejudiced against 
them. Certain textiles, such as French silks, fine English cottons, 
etc., are most artistically manufactured and are worthy of more 
use in this country. If we wish to sell our cotton and other products 
abroad, we must expect to import other commodities from foreign 
countries. 

Payments for imports are made through bills of exchange. 
Thus when an exporter of laces from Switzerland sends a shipment 
to an American importer, he does not receive payment directly 
from the importer. Instead he makes a draft on the American 
importer for the amount due him and gives the draft to a local 
Swiss bank for collection. The Swiss bank gives him the money, 
and receives credit on its books from the American bank, to which 
the American importer pays the amount due. Actually, no money 
is sent across the ocean for this individual transaction. Gold is 
shipped only to make up the deficit in the total balance of imports 
and exports. Drafts on certain English banks and others are 
accepted the world over, just as drafts on New York banks are 
accepted over the whole of the United States. 

The Linen Trade. Various countries have been able to specialize 
in the manufacture of a certain textile fiber or fabric. To illus¬ 
trate : In Russia there is a large linen industry, although her linens, 
with the exception of Russian crash, are hardly known outside of 
her own boundaries. Belfast, Ireland, has long been credited with 
being the natural home of the linen industry. No place in the 
world outside of Ulster produces fabrics of such pure whiteness as 
can be seen any day spread upon the green fields of counties Antrim 
and Down. The art of weaving and finishing linen tissues seems 
to belong to the Irish people by natural inheritance, and the water 
and atmosphere supply the peculiar properties essential to turning 


362 ECONOMICS OF CLOTHING AND TEXTILES 


out the various lines of snow-white goods that have given Belfast 
world-wide celebrity. In England the industry is mainly confined 
to Leeds and Barnsley, while in Scotland the principal centers are 
Dunfermline and Dundee. 

The fabrics and articles produced in these three countries are of 
the most varied character, including cream and bleached table 
damask, holland, buckram, glass cloth, butcher’s linens, toweling, 
elastic canvas, lace, handkerchiefs, etc. In the production of 
sheetings and shirtings Belfast occupies a unique place, leading the 
world. Holland and Belgium pay attention principally to plain 
goods, such as cambric, lawn, pillow and sheeting linen, etc. In 
Austria and Germany there is an immense production of linens of 
all classes, second in volume only to that of Ireland and Scotland. 
German linens ordinarily are lighter in weight, less clumsy, and 
altogether more sightly than those of Ireland and Scotland. Ger¬ 
man weavers make a specialty of cheap table damask and damask 
towels with knotted fringe and colored borders; they also turn 
out large quantities of attractive damasks in silk and linen. In 
Germany all the lowest and the highest grades of linens are woven 
on the hand-loom; the medium grades are woven on the power- 
loom. The reason for this is that the yarns of the inferior goods 
are too weak to stand the strain of the power-loom, and as labor is 
cheap in Saxony it is possible to produce them by hand at a very 
low cost. The higher grades are hand-woven for the reason that 
the work progresses so slowly that hand labor is more economical. 

France enjoys the reputation for producing the very choicest 
linens in the world. They are woven on power- and hand-looms. 
French damask, in particular, is noted for its excellent quality and 
its peculiar silky feel, characteristics due solely to the fine quality 
of raw fiber used and its skilful manipulation. The damask is 
not subjected to the usual finishing operations to improve its 
appearance. Being neither pounded nor pressed, it shows the 
natural round thread and lusterless surface that characterize linen 
when first removed from the loom. While the French product is 
not nearly so sightly nor so showy as the damask of Belfast, 
Dunfermline, and Bielefeld, it possesses the peculiar feature that the 
longer it is used the softer and more lustrous it becomes. The 
luster of Irish, Scotch, and German damask is produced, in the 


INTERNATIONAL TRADE 


363 


main, by the pressing process, and being artificial it disappears to 
a great extent the first time the cloth is laundered. 

The Cotton Trade. American cotton is in great demand in 
foreign countries because of its general excellence and the low 
price level. England particularly buys much cotton from the 
United States. India cotton is preferred by China and Japan, 
but occasionally when Asiatic cotton is of poor quality, or there is 
a small yield, the demand for American cotton becomes great in the 
Far East as well as in England. Russia raises its own supply of 
cotton. The Texas and far-west cotton is most popular for export 
purposes. 

Egypt furnishes to the United States a high grade of cotton 
that does not compete with American cotton. Egyptian cotton 
is long in staple and remarkably fine, smooth, and glossy, approach¬ 
ing — but not equaling — our own Sea Island cotton in these 
respects. The fiber is strong and takes dyes with unusual brilliance 
and permanence. These qualities particularly adapt it for the 
manufacture of hosiery, for which purpose it is largely used both 
in this country and in Germany. 

In length of staple Egyptian cotton ranks between the average 
Upland and Sea Island cotton. It is fine, but its particular value 
lies in its superior strength and elasticity and its remarkable 
development of twist, enabling it to cling together and make a very 
strong, fine yarn. When obtained in good condition, it has a fine 
luster and is soft and oily to the touch. As it is used in the produc¬ 
tion of a grade of fabrics that Upland and Sea Island cotton do not 
enter into, it consequently does not compete directly with them. 
It is used chiefly (either combed or carded) for the production of fine 
yarns. These yarns are used in the better grades of hosiery and knit 
goods, and for mixing with wool and silk. It is also used in making 
fine thread for laces, and is especially adapted for mercerizing. 

The direct importations of Egyptian cotton increased from less 
than 200,000 pounds in 1884 to more than 43,000,000 in 1896. 
Since the latter date the importations have fallen off somewhat, 
but this decline has been due to the shortage of the crop in Egypt 
rather than to lack of demand. 

Considerable amounts of Egyptian cotton are imported through 
various European countries. The price of such cotton ranges 


364 ECONOMICS OF CLOTHING AND TEXTILES 


higher than that shipped direct from Egypt. The requirements 
of the knit goods industry and the demand for a quality of goods 
that can be made only from Egyptian cotton seem likely to main¬ 
tain or even increase the demand for this grade. 

Egyptian cotton consumed by the United States mills usually 
goes into goods manufactured for the rubber, thread, mercerizing, 
and fine goods trades, according to a preliminary report on foreign- 
grown cottons used in the United States. It is estimated that 
about 55 per cent of the Egyptian cotton consumed in 1931 went 
into goods for the rubber trade, 25 per cent into goods for the 
thread trade, and the remaining 20 per cent into goods for miscel¬ 
laneous trades. 

During the year 1931, although the consumption of Egyptian 
cotton was lower by about 50 per cent in total number of bales than 
in 1930, the reduction in the consumption of cotton varying in 
staple length from l^g to lj inches was slightly more in proportion 
than the reduction in the quantities of cotton If inches and above 
in staple length. During 1931 the mills manufacturing fine goods 
strove to keep their production in line with their sales, and this 
may account for some of the reduction in the use of extra long 
staple. 

Because of strikes, changes in styles, the general business depres¬ 
sion, tariff, and the attempt of mills to keep their production in 
harmony with their sales, it is inadvisable to draw definite conclu¬ 
sions about trends in the use of Egyptian cotton. There has been 
an increase in the amount of Egyptian growths used during the 
last few years due to the experimentation of American mills in an 
effort to improve their product or reduce their cost of pro¬ 
duction. 

India ranks next to the United States in the production of 
cotton. The country is warm and very thickly populated, and 
cotton is naturally the fabric used for everyday wear. Through 
centuries of experience, the Hindus have developed a technique 
for spinning and weaving very fine cotton fabrics and also hand- 
block printed cotton fabrics. They have woven muslins of airy 
lightness with the aid of hand spinning and weaving devices. 
Extraordinary efforts have been made by the English to extend 
the cultivation of cotton throughout Asia. 


INTERNATIONAL TRADE 


365 


In addition to India, Egypt, and the United States, there are 
several other countries especially suited to the growth of the cotton 
plant, where large crops are annually produced. Among the most 
prominent are the following: Brazil, Mexico, Peru, West Indies, 
China, Japan, Java, Sumatra, Greece, and Turkey. Peru produces 
a peculiar variety of cotton with a strong, rough, crinkly staple, 
usually If to If inches long, known as “vegetable wool.” It is 
used by manufacturers of hosiery for mixing with wool, and is 
difficult to distinguish from the latter fiber except by chemical 
tests. 

In commercial importance cotton exceeds all other staples, the 
fiber furnishing the best material for clothing the larger portion of 
the human race in comfort and at low cost. It is the only textile 
fiber that may be gathered and immediately spun and woven, 
without any mechanical or chemical process of preparation. The 
properties of cotton strongly recommend it, especially in compari¬ 
son with flax, for clothing both in hot and cold countries. Flax 
has in some respects the advantage in that it forms a smooth, 
firm, and beautiful cloth, and is very agreeable to wear in warm 
climates. Because of its power to absorb moisture and give it off 
by evaporation, it naturally feels cool to the touch. But it is less 
comfortable than cotton and less conducive to health in extreme 
heat or extreme cold. 

The manufacture of cotton had its origin in the far East, where 
the climate renders a light and absorbent fabric a suitable clothing 
for the people. It has, in consequence, been long established over 
every part of Asia, although it was only in India that cotton was 
manufactured extensively with a view toward export to foreign 
lands. -The difference between ancient and modern India cotton 
goods appears to have arisen, not from any diversity in the nature 
of the fabric produced in that country, but from a change in the 
tastes and wants of the nations with which India has traded. 

The implements used by the Hindus in the different processes 
of cotton manufacture, from the cleaning of the fiber to its conver¬ 
sion into the finest muslin, may be purchased for a few dollars 
and are of so crude and simple construction as to be evidently the 
invention of a very early period. With the exception of the loom, 
none of them deserves the name of a machine or displays the 


366 ECONOMICS OF CLOTHING AND TEXTILES 


slightest mechanical ingenuity. The finest and sheerest cotton 
fabric produced in the world is made, even at the present time, with 
implements as primitive as the flint of the prehistoric races. The 
Dacca muslin, sometimes called the “ woven wind of India,” 
still constitutes the most perfect specimen of a woven cotton fabric 
that can be found. Yarn has been spun upon modern machinery 
that is finer than that from which this muslin is made, but no 
tissue so perfect in all respects has yet been woven upon the power- 
loom. In making these fine muslins, the cotton fiber is separated 
from the seed by the use of a bow of bamboo strung with rawhide; 
it is carded with the bone of a fish; twisted into thread by the use 
of the distaff; and woven on a primitive loom made of bamboo 
reeds. The well-managed finger and thumb of the Hindu spinner, 
patiently and carefully applied to the formation of a thread, and the 
moisture at the same time communicated to it, are found to have 
the effect of arranging the fibers of cotton more perfectly than can 
be done by our most improved machinery. 

Between this pre-historic type of work and the great factory of 
modern times there can be found but two really original inventions: 
namely, the method of extending the strand of cotton by the 
revolution of rollers, applied first by Arkwright little more than a 
century ago, and the invention of the saw-gin by Eli Whitney in 
1792. All else in the great factory is but an evolution of devices 
as old as history. Changes have occurred by the score in the detail 
of each machine, but not in the substitution of new machines upon 
a different principle. 

The great perfection attained in cotton manufacture and its 
wonderful development within the past century are due to the 
inventive skill and untiring energy of the mechanicians, of the 
United States and England. Compared with the inventions and 
improvements introduced by English and American inventors, 
those contributed by other nations are insignificant and scarcely 
worthy of mention. While the English were the firstito use power 
machinery for spinning and weaving, the Americans have made 
many inventions that have faciliated and cheapened cotton manu¬ 
facture. All of the American methods of any merit have been 
adopted in England, and all English improvements have been 
introduced into America. This interchange of the inventive skill 


INTERNATIONAL TRADE 


367 


of the two countries has been going on for more than a century, 
so that at this time neither can boast of any especial advantage 
over the other in patented machinery. England has undoubtedly 
done more than any other country toward putting cotton into 
various manufactured products suitable for the different peoples 
of the earth. She has also created vast shipping interests, without 
which much of our raw cotton could not have been sent abroad for 
consumption. In the annual consumption of raw cotton Great 
Britain ranks first, the United States second, followed by France, 
Germany, and Russia. 

The manufacture of cotton goods in Europe is said to have been 
first begun by the commercial cities of Italy before the discovery 
of the passage to India by the Cape of Good Hope. 

England has always purchased cotton from the United States, 
but during the Civil War, 1861-1865, the supply was cut off, and 
England then made attempts to extend the cultivation of cotton 
among her colonial possessions and parts of Asia. 

The following account will show how textile products are ex¬ 
ported to the Orient. Texas and Oklahoma in 1931 furnished the 
world with one-fourth of its supply of raw cotton. In seven and 
one-half months, more than 4,000,000 bales of cotton, or two-thirds 
of our total cotton exports, sailed out of Texas ports for various 
parts of the world. Nearly half of it went to the Orient. In 
addition, nearly 2,500,000 bales were in storage in Texas ports. 

The transportation cost to land a bale of Texas cotton in Shang¬ 
hai or Bombay or Kobe, halfway around the world, is less than 
the cost of delivery to a South Carolina mill. The freight on a bale 
of cotton from Houston to Shanghai, some 10,000 miles, is less than 
it is from Dallas to Houston, under 300 miles, which shows that 
the cheapest transportation in the world today is the power-driven 
vessel on the high seas. 

Over a hundred years ago, Thomas Jefferson said that the way 
to encourage purchasers is to multiply their means of payment. 
In this country in 1928-1934 we have adopted the opposite policy. 
The close of the War found the world deeply in our debt. Dur¬ 
ing the ten years following the War, we did a very large export 
trade, mostly on credit — thus further enlarging the indebtedness 
of the rest of the world to us. When our economic situation 


368 ECONOMICS OF CLOTHING AND TEXTILES 


commenced to show strain and stress in 1928 and 1929, we sud¬ 
denly discontinued further foreign credit. This then threw our 
foreign customers on their own resources to pay for their pur¬ 
chases from us and the interest on what they owed us. 

Only two means of payment were open to them, the shipment of 
gold and the shipment of goods. Except for France, we already 
had most of their gold. As for payment in goods, we promptly 
closed that method by the passage in 1930 of the Hawley-Smoot 
Tariff Act, carrying the highest rates of duty ever put into law in 
this country. In 1934 the policy was changed so as to allow Eu¬ 
ropean countries to pay their debts by the shipment of goods. 

Although in recent years American cotton has encountered 
increasingly sharp competition from foreign growths, yet according 
to reports the United States is not in any danger of losing its world 
supremacy. A study of conditions indicates that even with world 
consumption low in 1930-1931, and foreign growths cheaper in the 
main than domestic growths, proportionate use of American cotton 
dropped only slightly. While quality and grade greatly affect 
consumption, world business conditions represent one of the most 
important factors bearing on the foreign use of American 
cotton. 

Many forces have been pushing down the price of cotton in 
recent years; namely, overproduction, seeming indifference to 
quality, competition of foreign growths, business conditions, etc. 
Overproduction can be remedied, quality can be further improved, 
and these are of major importance. There is no doubt that prices 
will be relatively greater in line with consumption. 

The Wool Trade. The geographical location of a country has 
much to do with its use of a textile. Cotton is used in the warm 
countries, while wool is used in the cooler climates. Wool furnishes 
the most important material for clothing in all cold and temperate 
climates, and next to cotton represents the most important of all 
textile fibers used by mankind. From the earliest times it has 
been employed in the production of felt and cloth. The testimony 
of ancient writers goes to prove the high antiquity of woolen 
textures. For ages before the invention of spinning and weaving, 
the fleece-covered skin of the sheep was undoubtedly worn as a 
garment, as in the case of Elijah’s mantle. 


INTERNATIONAL TRADE 


369 


Wool is one of the most ancient articles of international com¬ 
merce. In the Middle Ages it was by far the most important of 
all the exports of England. It is, indeed, an article of production 
in every civilized country in the world, and also in many countries 
that are only partly civilized. Wherever agriculture is pursued 
at all, or wherever there is pasturing, sheep are kept. The sheep 
of the world are many more in number than are all the cattle, 
horses, hogs, and goats together. Many countries in which modern 
manufacturing methods are unknown, and in which even domestic 
manufactures are but crude and scanty, raise wool and use it as a 
means of obtaining goods produced by the more advanced countries. 

The great wool-consuming countries of the world are the United 
States, Great Britain, France, Germany, Belgium, and Russia. 
The United States has for many years depended mainly upon its 
own supply of this fiber, though our use of foreign wools is con¬ 
stantly increasing. 

The first settlers in the American colonies of Virginia, Massa¬ 
chusetts, and New York either brought sheep with them or they 
were brought with the earliest importation of supplies from the 
native land. With furniture and household equipment came the 
loom and the spinning-wheel. The matrons of the household were 
weavers and the daughters spinners. The clothing of the country 
people was largely of domestic manufacture from wool grown on the 
farm. The sheep were mainly from the countries of the settlers — 
England and Holland. It is said that the first sheep brought into 
the colonies landed in Jamestown, Virginia, in 1609. Settlement 
was slow and the increase in the number of sheep moderate, but in 
1649 the number in Virginia was reported as 3000. There were 
early importations into Massachusetts, and by 1640 the number 
of sheep was estimated at 3000. The Dutch brought over sheep 
to New Netherlands in 1625, and a Swedish colony brought 80 
sheep into Delaware in 1663. 

All the colonies introduced flocks and encouraged the domestic 
manufacture of wool. In 1645 Massachusetts enacted a law for the 
encouragement of the raising of sheep; and in 1656 a law was 
passed requiring each family to spin three pounds of wool, cotton, ’ 
or flax per week for thirty weeks in a year. In the same year a 
skilled weaver, induced by a gift of thirty acres of land, settled in 


370 ECONOMICS OF CLOTHING AND TEXTILES 


Lowell, Mass., and this city has since become a great center of 
textile industry. 

Today the number of sheep in the United States is over 40,000,000. 
They are raised on open ranches and this causes a high labor 
cost for herding. 

New Zealand, consisting of two long narrow islands, is an ideal 
sheep country, with excellent shipping facilities. The climate 
is very uniform, so that green grass and pastures are available all 
the year. This results in a well-grown, superior grade of wool, 
with rapid mutton development. The flocks are about 1100 in 
size and handled by general farmers. 

Italy has intensive agriculture and a growing industrial area 
and therefore can not afford to devote much land to sheep raising. 
Those that are raised, numbering about 12,000,000, are found in 
the southern parts and on the adjacent islands. France had, a 
generation or so ago, large numbers of sheep, but they have now 
dwindled to 14,000,000. Germany has the finest wool in the 
world, and while the number of sheep is small, there is a movement 
to increase the supply. Ireland produces a coarse, heavy wool. 
Russia supplies a large amount of wool in Europe. This wool is of 
many varieties. Spain was once a prominent wool-raising country. 
Its product was of the finest kind — merino wool — but production 
has declined. Spain exports much wool to France. 

Most of the wool raised in Asia proper is very coarse, suitable 
only for carpets and coarse clothing. Turkey uses most of her 
wool for her carpet factories. Japan, because of its limited area, 
will never be a sheep-raising country. China raises much wool 
that is coarse and is used for American carpets. India is rapidly 
developing into a wool-raising country. The government is making 
an attempt to improve the stock and also to increase the pasture 
land. The wool is sent to Liverpool, England, where it is sold at 
auction. 

In Africa, Cape Colony and Natal are good wool-raising countries. 
The economic conditions of the people often compel them to shear 
the sheep twice a year. The wool is used for fabrics and lace, 
'because the fiber is very thin. Egypt raises very little wool, and 
that is of very poor quality. It hardly pays to shear the sheep. 
Attempts are being made to improve the stock. 


INTERNATIONAL TRADE 


371 


Most of the wools in England are bought direct from the farmers, 
while the Irish wools are bought by English wool merchants from 
small storekeepers through the country towns. The storekeeper 
pays the farmers in seeds, potatoes, etc. The wool is often bought 
and sold at auction in the warehouses of London, Liverpool, and 
Bedford. Rags or remanufactured wools are often sold at auction 
in England. 

Due to sheep diseases, under-feeding, and other handicaps, there 
is very little sheep-raising in Canada. 

In South America there are various high-grade forms of sheep¬ 
raising. The sheep in Uruguay are kept in paddocks of large area 
which reduce the cost of herding. Argentinian sheep-raising has 
ceased to increase because of the fact that more money can be 
made in raising beef than sheep. The islands about Chile are 
excellent grounds for sheep-raising and develop a high grade of 
wool for hosiery. 

England has been the source not only of fine cottons, worsteds, 
and wooleAs, but also of rugs, laces, velveteens, etc. In addition, 
England has specialized in men’s clothing and has become the style 
center of men’s wearing apparel. Hence much of the best wearing 
apparel for men is exported from England. 

Dress and upholstery trimmings are made by the cheap peasant 
labor of Germany and France and are exported to the United States. 

Furs are imported in the raw from Canada (otter, sable, mink, 
beaver, marten, seal), Russia (sable), Persia (lamb), Liberia (squir¬ 
rel). The United States exports a large quantity of finished fur 
garments. 

The Silk Trade. China and Japan furnish the bulk of the world’s 
supply of raw silk. 1 The United States imports from Japan in 1931 
amounted to $205,399,000, as compared with $279,113,000 for 1930 
and $431,872,000 for 1929. The trade in raw silk in 1931 amounted 
to $162,921,000, about $62,000,000 less than in 1930 and almost 
$200,000,000 less than the raw silk imports in 1929. But these 
declines are held to be entirely due to conditions resulting from the 
depression. 

It is one thing, holds the Japanese commercial attache’s office, for 
a comparatively small number of individuals to say that they will 
1 See Chapter X for further details of silk production. 


372 ECONOMICS OF CLOTHING AND TEXTILES 


not buy a certain country’s or a certain manufacturer’s products, 
and another thing for them to carry out their threat when it affects 
their pocketbooks adversely and runs counter to their personal 
desires. Sentiment may affect a few, but the mass of people will 
continue to buy the Japanese goods they like and find it to their 
economic advantage to purchase. Wearing garments of silk and 
drinking Japanese tea are habits which are not easily broken. 

The United States has taken from 80 to 90 per cent of Japan’s 
total exports of raw silk, and Japan gets over 50 per cent of our 
exports of cotton. While American imports from Japan have 
held more or less to the low levels reached before the Sino-Japanese 
situation developed in Manchuria and Shanghai, Japan’s imports 
of certain of our products have increased. This is notably true in 
the case of cotton. During December, 1931, Japan imported 
31,696,000 yen of American cotton, whereas in December, 1930, 
her imports of the same commodity amounted to only 21,637,000 
yen. The increase in raw cotton imports, both in December and in 
January, was explained by the commercial secretary of the Japanese 
Embassy, Ya-suto Shudo, as being due, not to munition manufac¬ 
turing needs, but to the low price of American cotton and the use of 
gold credits previously established in this country by Japanese firms. 

While the United States does not import much silk cloth from 
Japan, the Japanese have successfully placed on the market a 
variety of Japanese silk, soft and wavy in texture and thicker than 
the ordinary hand-woven tissues of the far East. In width it 
ranges from 12 to 44 inches and is of various grades, the finest quali¬ 
ties being suitable for any purpose to which silk can be put. In the 
American market it is used chiefly in the form of handkerchiefs and 
as plain and printed dress silks, underwear, and night-robes. 
Ordinary habutai has two strands in each of the warp threads and 
the same number in those of the weft. Occasionally three strands 
are used, in which case the quality of the goods is greatly improved, 
and the texture is correspondingly heavier. Very cheap habutai 
is woven of coarse threads composed of but a single strand. As a 
rule, in this grade the weft is beaten up so slackly that the cloth 
“pulls” on the slightest pressure. 

Habutai is woven on hand-looms, which are in many cases still in 
their primitive condition, but are also found provided with modern 


INTERNATIONAL TRADE 


373 


improvements. Being constructed of pure undyed silk and care¬ 
fully woven, the fabric possesses much luster and that peculiar 
softness to which it owes its name. Besides luster and softness, 
habutai silk is characterized by evenness of texture and compara¬ 
tive lightness. It has been used by the better classes in Japan 
for everyday wear for about 250 years, a test sufficient to give it 
a good standing among Western nations. 

Because France has for centuries, through governmental interests 
and the influence of the nobility, been the style center of the 
world, it is only natural that it should export much expensive 
wearing apparel of all kinds. In addition, France also exports 
beautiful manufactured silks of both printed and woven designs 
and fine wools and worsteds. Artificial flowers are made in France 
by children. 

Under the impulse of fashion and luxury, lace has received the 
stamp of the special style of each country. Hence, more or less 
lace or hand-work fabrics are exported from several countries, 
particularly Belgium, Ireland, Italy, Switzerland, and France, as 
well as cheaper grades from America and China. Embroideries 
are also imported from China and Japan, Switzerland, Germany, 
and Scotland. Up to 1828, beautiful lace and embroidery were 
done by hand, but with the invention of machinery it was possible 
for two persons to do much more than a dozen experts by hand, 
and the amount of worsted embroideries done by hand has been 
reduced to five per cent of its former amount. 

The Leather Trade. The term kid is shoe-leather made from the 
skins of mature goats. The skin of the young goat or kid is made 
into the thin leather used for kid gloves, since it is too delicate for 
general use in shoes. The goats which supply the leather used in 
this country for women’s and children’s fine shoes are not the 
common, domesticated variety known in this country, but are 
wild goats or allied species partially domesticated. They are found 
in the hill regions of India, the mountains of Europe, portions of 
South America, etc. 

There are from six to eight recognized kinds of goatskins that are 
imported from all over the world. The Brazilian, Buenos Aires, 
Andean, Mexican, French, Russian, Indian, and Chinese goats are 
a few of the many kinds that are known as such. The skin of each 


374 ECONOMICS OF CLOTHING AND TEXTILES 


particular species of goat hides has its own peculiarities of texture. 
The thickness and grain differ according to the environment in 
which the animal has been raised. It is peculiar that those goats 
raised in cold climates do not have as thick skins as those raised 
in warmer climates. The long, thick hair apparently takes the 
strength from the skin. 

We may wonder where all the skins come from that are made up 
into glazed kid, mat kid, and suede. The great portion of the skins 
are goatskins. These are almost all imported from abroad, where 
the animals are slaughtered and disposed of much the same as we dis¬ 
pose of beef and veal here. Sheepskins and carbarettas, the hides 
of animals that are a cross'between sheep and goats,"are also used. 

The finer grades of kid and goatskins, which are tanned in large 
quantities in New England, come from the Far East. In China 
there are two great ports from which skins are shipped — Tientsin 
and Shanghai. Back in the interior, starting from about 1200 
miles from the sea, collectors make their rounds twice a year. The 
breeder of goats kills his flock just before the collector is due, skins 
the animals on the hillside, preserves the meat for food, and makes 
his way to the station with the kidskins, which have been partly 
dried and wrapped in a bundle that is carried upon the back, or 
upon a pack animal. There may be as many as fifty breeders 
awaiting the coming of the collector, who pays them the market 
price of the skins. 

Whenever the collector has a sufficient supply to make it profit¬ 
able to ship, he bales the skins and sends them over the thousand- 
mile journey along the river to the seaport. From Tientsin or 
Shanghai they are taken by tramp steamers, which reach eastern 
ports by way of the Suez Canal. On the trip the steamers make 
several ports, so that it is from six to ten weeks before the skins 
reach America. Another method of importing is to have the raw 
material shipped across the Pacific and then transferred to a 
railroad, but the difference in cost to the manufacturer is so great 
that this method is unprofitable. The goatskins from China are 
rated as among the finest in the world, and when tanned they make 
the highest-grade shoes. 

Mocha skins come from Tripoli, Arabia, and Northern Africa. 
In those places the method of collection is practically the same as 


INTERNATIONAL TRADE 


375 


in China. The two best-known grades are the Hodieda and the 
Benghazi. They derive their designations from the exporting 
cities. Hodieda is located in the southwestern part of Arabia on 
the Red Sea, while Benghazi is in Barca, one of the provinces of 
Tripoli. 

Other goatskins are produced in India and Russia. Millions 
of skins are exported annually from Bombay, Madras, and Cal¬ 
cutta. These skins are not brought directly to America, but are 
transshipped at Marseilles or London. 

The jobbers in Europe or India occupy a unique position, for 
according to their practice it is almost impossible for them to 
suffer financial loss in dealing with an American tanner. The 
latter, when he wishes to arrange for his year’s supply of raw 
material, negotiates with an agent in Boston, with whom he signs 
a contract for so many skins. Then it is necessary for the tanner 
either to purchase his supply with money equal to the face value of 
the invoice or to borrow money for letters of credit from Boston 
banking houses that have European connections. 

Before the skins are exported, the jobber has his money from the 
European banking concerns, and the bills of lading are forwarded 
to the Boston bankers. The latter turn them over to the tanners, 
and when the occasion requires, they obtain from the tanners 
what is known as a deed of trust. 

All goatskins are tanned by the same chrome tanning process, 
whether the finish is to be glazed or mat. The proportions of 
chemicals vary according to the texture of the skin, and according 
to the grain. 

Rugs. Rugs and carpets as well as wool are imported from 
Persia and Turkey. Among people of good taste, oriental rugs 
or carpets are prized far above machine-made products, due to 
(a) skill in manufacture, (6) beauty and novelty of pattern, 
(c) rich and harmonious colorings. In addition, the rugs are the 
must desirable in the world because they are built knot by knot, 
slowly and carefully. In addition, the wool is raised from sheep 
that are carefully looked after and housed so that the texture of 
their fleece is the finest. 

Many attempts have been made to imitate oriental rugs, but 
without success. No machine has ever been invented which can 


376 ECONOMICS OF CLOTHING AND TEXTILES 


give the twist to the yarn and tie the square knots which are 
peculiar features of the hand-made fabrics. The native Persian or 
Turk has from early youth acquired a technique in making rugs. 
These methods are considered constant as religious habits and have 
been handed down from father to son. Inhabitants of Turkey, 
due to their mode of living and their religious habits, have devel¬ 
oped special ability in making rugs of durability and artistic 
design. 

The cheaper grades of floor rugs are made on power-looms in 
England and the United States. Those made in the United States 
are artistic and can be sold very reasonably. They are popular 
in all the markets of the world. 

The Tariff. Tariff is a word derived from the name of the town 
Tarifa in Spain. This town received its name from Tarifa Malek, 
a Saracen chief, who landed at this point on the coast in the year 
710. During the Moorish domination, all vessels which passed 
through the Straits of Gibraltar were at Tarifa compelled to pay 
duties or tribute to the savage chief; whence the word tariff. As 
used at present, the word indicates a list of goods with the specified 
duties or customs to be paid upon them, either upon importation 
or exportation. In the United States there can be no duties 
imposed on exports; our tariff duties must all be laid on imports. 
Ad valorem is the duty or tariff measured by the net value of an 
invoice of goods. Ad valorem duties are levied according to the 
market value or worth of goods at the original place of shipment, 
as sworn to by the owner and verified by the customs appraisers. 
Specific duty is the duty or tariff levied by units of measurement, 
i.e., the number or quantity, as dozen, gross, or ton. 

To show the effect of the tariff on textiles and clothing let us 
consider as an illustration the effect on silks. 

To view the development of the silk industry in a broader light, 
the silk manufacture has grown in America under the tariff from 
almost nothing to tremendous proportions, while during the same 
period it has actually decreased in England under free trade. Thus 
in the United States the value of manufactured silk increased from 
$6,600,000 in 1860 to $583,000,000 in 1921, while the number of 
employees rose from 5000 to 126,000. Importations of manufac¬ 
tured silk amounted to about $33,000,000 in 1861, and have 


INTERNATIONAL TRADE 


377 


remained about constant. Thus the home manufacturers have 
supplied the greater demand due to increased population and 
higher prosperity. 

In Great Britain, however, there was an import duty till 1861 ; 
upon the removal of that duty the imports of manufactured silk 
rose from £6,000,000 in 1861 to £13,000,000 in 1911, but silk 
manufacture there decreased so greatly that where it employed 
116,000 in 1861, it had only 37,000 in 1901. 

In 1913 the United States consumed as much raw silk in manu¬ 
facturing silk goods as France, Germany, Italy, and England put 
together. Similar results have been obtained in other textiles. 

We have seen that with the development of the steam engine 
in the early part of the 19th century England began to develop 
the manufacture of practically all commodities, particularly tex¬ 
tiles. The statesmen of the 19th century — Cobden, Peel, and 
Gladstone — convinced the English people that England should 
become the greatest workshop and factory center of the world, 
and that her future lay in the expansion of foreign trade. England 
had the equipment and skill which would enable her to manufacture 
textiles, etc., cheaper than anybody else. What she needed to do 
this work efficiently was low-priced foods and low-priced raw 
materials. To secure these it was necessary to have no duties on 
imports — no tariff — and freedom to enter all foreign markets. 
This meant that she wanted no tariffs abroad. In order to secure 
this concession, it was necessary for England to allow all countries 
to import into England free of duty. This policy was developed 
and England became the richest nation of the world, as money 
poured in from all sides. 

The United States was settled at first by English people, who 
transported their industries to New England, which naturally be¬ 
came a textile center. After the middle of the 19th century, when 
the textile industries began to develop, it was necessary to protect 
the American products from the competition of the English mills. 
The government finally passed bills at different times imposing 
duties — tariff — on imported textiles. As a result of this tariff, the 
textile industry developed enormously in size and wealth. Prior 
to and after the World War, all countries began to learn to use 
power machinery — particularly spinning and weaving machines. 


378 ECONOMICS OF CLOTHING AND TEXTILES 


They had learned from war the value of developing a standard of 
self-sufficiency, particularly for the necessities of life, such as food, 
clothing, etc. In order to carry out this policy, each country began 
to keep out the products — particularly textiles — of England and 
other countries, and to preserve its own markets for its own people. 
The policy has developed until today practically all countries of 
the world have set up tariff regulations. 

Russia, with her governmental trade monopoly, allows nothing 
to enter from abroad except the specific articles which it desires 
and can not produce at home. Lest this restriction prove in¬ 
effective, the Soviets have so reduced the purchasing power of 
the Russian people that they could not buy anything foreign even 
if they had a chance. In 1934 they began to make trade treaties 
with the United States. 

Spain and the United States have made their tariffs so high that 
they tower above all others, and neither country shows any marked 
disposition to lower them. All the countries of eastern Europe are 
trying their best to emulate these leaders, and France, Germany, 
and Italy are not far behind. Only Great Britain, Belgium, the 
Netherlands, and the Scandinavian countries on the Continent are 
still striving to keep tariffs down to a trading basis. 

The ultimate outcome of a policy protecting home industries is 
to shut out all foreign goods that compete with home products. 
This in turn means the elimination of foreign trade, with each 
country confining its efforts to supplying the home market without 
foreign competition. While this plan may succeed with regard to 
the cheap and medium grades of textiles and other products, it 
will be impossible for each country to make the finest qualities of 
all kinds of wearing apparel. We have already seen that there are 
certain countries that, due to natural and labor conditions, excel 
in certain products. So there will always be an opportunity for 
the development of trade in foreign raw materials and the finest 
grades of textiles. 

Of course the elimination or reduction of the foreign business 
in textiles will affect certain branches of the textile trades, particu¬ 
larly such as the cotton trade, which has grown to world propor¬ 
tions. This would require an all-around readjustment of workers 
and industries. 


INTERNATIONAL TRADE 


379 


Many successful business men feel very strongly that high 
tariffs tend to diminish international trade and cause a general 
depression. They point out that Australia placed a high tariff 
in order to increase revenue and also to protect home industries. 
It did neither, and producers found they gained little by the high 
schedules of the tariff. 

Many business men feel that the ideal tariff is one which would 
afford protection to an industry as long as it is conducted efficiently. 
When the difference in production-costs of foreign and domestic 
textiles prove that domestic commodities are excessive in price, 
then the industry or trade is not, in their opinion, entitled to pro¬ 
tection. 

The industrial history of the United States shows that the subject 
of the tariff has been before the country for over a century. One 
political party has favored a tariff for revenue only, and to assist 
as few industries as possible. The other party has advocated 
a high tariff to protect all our industries. 

Experience shows that high tariff regulations, in the long run, 
tend to: 

1. Raise the general price level of labor and raw materials. 

2. Cause a reduction of imports, which reduces the purchasing 
power of other nations and decreases our exports to an extent 
proportional with the decrease of our imports. (The total amount 
of imports and exports should tend to be nearly equal.) 

3. Create a gain in employment in the home consumption 
industries that is offset by the loss of employment in the import 
industries. 

4. Cause foreign countries to develop discriminatory tariff 
legislation against the nation with a high tariff. 

If the United States is to prevent tariff restrictions against its 
foreign trade, it must be prepared to make certain concessions. 
We can not continually bar European products from the American 
market, while claiming a right to trade abroad. The only funda¬ 
mental means of preventing discrimination against our products 
is by reducing the tariff. 

Between the years 1798 and 1923, the United States adopted 
the policy of tariff bargaining, by which we agreed to keep certain 
articles on our free list (without duty) if, in return, the other 


380 ECONOMICS OF CLOTHING AND TEXTILES 


country promised to admit free or at low duty certain or all imports 
from the United States. 

The international trade of a country is influenced by favorable 
tariffs and by depreciated currencies in other countries. 

In 1932 United States* trade with Great Britain began to decrease. 
While Britain is buying progressively less from the United States, 
the United States is buying progressively less from Great Britain. 
During 1931 Great Britain bought goods to the total value of 
£104,171,028 (about $519,000,000 at par) from the United States, 
which was only slightly more than half as much as during 1929. 
The United States, however, bought British goods to the total value 
of £25,112,212 (about $125,561,060), which was considerably less 
than half of the 1929 purchases. 

Depreciated sterling and tariffs are resulting in still further 
reduced purchases of American goods by Britain. Britain is 
buying, where possible, from countries which also have depreciated 
currencies, and in addition she is making at home many articles on 
which recently imposed prohibitive tariffs have made the foreign 
article more expensive than the domestic product. The govern¬ 
ment’s policy of “buying from those who buy from us” has nothing 
to do with restricted purchases of American goods. The import 
trade remains a strictly business proposition. British importers 
buy where they can get the most for their money. It now happens 
that in many cases they can buy more cheaply from countries with 
depreciated currencies. 

During the first nine months of 1931 Britain bought slightly 
less than 12 per cent of all her imports from the United States. 
During the last quarter, after the gold standard was suspended and 
sterling had depreciated, more than 13 per cent of all imports came 
from the United States. 

Admission of Imports. Importation into the United States can 
be made only at ports of entry constituted by law. All goods so 
imported must be entered at a customhouse by presenting a bill 
of lading, an invoice duly certified by the United States consul at 
the port from whence they are shipped, and a description of the 
goods sworn to by the importer. If the goods are free of duty, 
a permit to land is immediately issued, subject to official inspection 
and verification of the goods. If the goods are dutiable, the tariff 


INTERNATIONAL TRADE 


381 


is estimated at the customhouse and paid in cash. A permit is 
then issued to send one or more packages to the government 
appraiser for examination, to determine whether they have been 
invoiced properly. The balance of the goods is delivered to the 
importer, under bond to produce them should the examination of 
the samples show discrepancies with the statements and descrip¬ 
tion. If the appraiser finds the goods to have been undervalued, 
they are subject merely to the additional tariff on the excess value. 
Any fraudulent undervaluation involves the confiscation of the 
goods concerned. Goods may be transported to interior ports in 
bond, directly from the importing vessel. There are customhouses 
in all the large cities of the United States. 

The establishment of New York as a “free port” with a foreign 
trade zone, through the passage of legislation now in Congress, is 
urged by many persons as one means of helping American shipping 
and port facilities. The principle involved has been indorsed by 
many branches of the federal government and by numerous busi¬ 
ness and port organizations throughout the country, including the 
most outstanding bodies in the New York district. The following 
will explain the reasons for such an arrangement: 

“One method of stimulating use of American shipping and port 
facilities in the face of a dwindling foreign trade is the establishment 
of zones in which foreign merchandise may be landed for storage, 
cleaning, repacking, and other manipulation prior to re-export to 
foreign countries. This type of port is known as a foreign-trade 
zone or free port, and is very common in European countries. 

“The trade of Hamburg, Danzig, Copenhagen, and other Euro¬ 
pean ports is largely concentrated at the docks and warehouses 
within their free port zones. As yet no provision has been made 
to legalize the establishment of such zones in the United States. 

“The service via New York is usually more frequent and superior 
as to type of vessel. Through the use of optional bills of lading 
it is possible for the shipper to send a consignment to New York 
and determine upon arrival how much he will transship abroad. 
The development of the transshipment and re-export business for 
the benefit of American ports and shipping, in the judgment of 
the United States Shipping Board which has studied the subject, 
will be greatly facilitated by the setting up of foreign-trade zones. 


382 ECONOMICS OF CLOTHING AND TEXTILES 


Such zones would be legally outside of the customs formalities, 
involving the use of bonded warehouses, or the present domestic 
entries followed by claims for drawbacks on re-exported goods. 
Such foreign-trade zones will be fully policed to insure payment of 
duty on any of the merchandise brought through the customs bar¬ 
rier into the United States for sale.” 

The Bureau of Foreign and Domestic Commerce. When the 
layman thinks of the Department of Commerce, he perhaps thinks 
chiefly of the Bureau of Foreign and Domestic Commerce, which 
in the United States is an agency for promoting what is considered 
better business practice, and abroad is frankly and openly a sales 
promotion agency for American goods. Measured by cost of 
operation, this bureau is one of the least important, spending only 
about one-tenth of the amount of money required for the lighthouse 
service. Measured by its influence, it is one of the most important 
agencies of the commerce department. 

In domestic matters the bureau offers its services to trade 
associations that ask for them. It can not, despite recent rumors 
to the contrary, prescribe how much butter shall go into a three- 
decker drug-store sandwich. It has, however, lent its experts to 
assist in surveys of the drug, grocery, and other businesses in 
various localities. 

Abroad, it now has a working agreement with the consular 
service, which has smoothed out many old jealousies and prevented 
overlapping efforts. It has, at least for the remainder of the 
present fiscal year, some sixty foreign offices, scattered everywhere 
on the globe where American merchants sell or hope to sell their 
goods. Half of these are on the European Continent, a quarter in 
Latin America, a few in Africa, and the rest in the Far East. 

Commerce department attaches, like those of the military and 
naval services, are stationed at the principal legations and minis¬ 
tries. They investigate general economic situations and specific 
questions on credit. They protect American trademarks. Calls 
for help from American merchants and agents all over the earth 
come in at the rate of 13,000 a day. 

Importance of Our Import Trade. The United States imports 
considerable quantities of raw materials for which it must depend 
almost entirely upon foreign sources of supply. For example, it 


INTERNATIONAL TRADE 


383 


uses almost half of the world’s supply of tin, while producing but 
one-tenth of one per cent. We use 57 per cent of the world’s 
supply of silk and 70 per cent of the world’s supply of rubber. 
Manganese, asbestos, and many other products are also necessarily 
obtained from other countries. 

While under pressure of necessity, American industry might 
resort to substitutes for some of these important raw materials, 
and science might lessen American industry’s dependence on them, 
through discovery of new substitutes, it would be unwise to expect 
science to supply this country with substitutes for all the important 
materials which nature has failed to provide within our own land. 

Even if it were possible to exclude from the domestic market all 
raw materials that could be produced in this country or could be 
replaced by substitute materials of domestic origin, a radical 
and expensive reorganization of production methods would be 
necessary. At the same time, such drastic restrictions imposed on 
our imports would naturally result in a serious contraction in our 
exports, since the buying power of foreign nations in terms of goods 
and services would be materially curtailed. 

Interdependence presents a serious problem, and excessive 
rivalry creates friction and ill will. We must remember that the 
business men of the world contribute to the development of an 
atmosphere of international good will; they will minimize whatever 
fears economic interdependence may produce, and will establish 
a sound foundation for peaceful world intercourse. 

Suggested Policy for International Trade. A suggested policy 
for international trade would be : 

First: To initiate a movement for an international economic 
conference, with a view to : (a) lowering excessive tariff duties and 
eliminating discriminatory and unfair trade practices and other 
economic barriers affecting international trade; ( b ) preventing 
retaliatory tariff measures and economic walls; (c) promoting fair, 
equal, and friendly trade and commercial relations between 
nations. 

Second : To negotiate with foreign governments reciprocal trade 
agreements under a policy of mutual tariff concessions. This 
reciprocity clause should specify that any agreement, treaty, or 
arrangement affecting our own tariff must first be approved by the 


384 ECONOMICS OF CLOTHING AND TEXTILES 


Congress of the United States and shall not become operative until 
it has been thus approved. 

The Tariff Commission. The United States feels the need of 
constant revision of the tariff. The government has appointed 
a non-partisan commission of three Democrats and three Repub¬ 
licans to study tariff questions. This is called the Tariff Com¬ 
mission. 

Its purpose is to conduct investigations under what is known as 
the flexible tariff provision, Section 336 of the Hawley-Smoot 
Tariff Act of 1930. This authorizes studies of production costs at 
home and abroad whenever the commission decides that complaints 
regarding existing tariff rates are justified. The complaints may 
hold that the rates are either too high or too low because of chang¬ 
ing world conditions or inequalities in the law. 

Investigations under this section are made upon (1) request of 
the President; (2) resolution of either house or both houses of 
Congress; (3) the commission’s own initiative, and (4) application 
of any interested party. Applications may be made by foreign 
interests as well as by domestic industries and importers. Requests 
for investigations by the President or by Congress are accepted as 
mandatory. From the passage of the Tariff Act of 1930 to June 30, 
1932, there were 171 requests for investigations under this section. 

All investigations are based upon the differences in cost of 
production. In each inquiry the commission must determine: 
(1) the likeness or similarity of the articles to be compared ; (2) the 
principal competing country; (3) the cost of production, together 
with transportation and other delivery charges to the principal 
market or markets in the United States. The costs are then 
compared to determine the proper rate of duty, but no change may 
exceed a 50 per cent increase or decrease of the rate prescribed by 
the Tariff Act; no transfers may be made from the free to the dutia¬ 
ble list, or vice versa, and the form of duty may not be changed. 

As new industrial conditions develop, new tariff problems arise, 
and new methods of trade control must be considered. At the 
times of depression, when the values of foreign currencies are 
unstable and when foreign governments are subjecting their inter¬ 
national trade to drastic measures of control, it is necessary that 
some well-informed agency of government shall follow such changes 


INTERNATIONAL TRADE 


385 


and measures in order to be in a position to advise the Congress 
concerning their effects upon industry and commerce. 

The organization of the commission primarily consists of the 
Washington headquarters and a field service operating in three 
groups, including the New York office, the European office at 
Brussels, and the valuation unit — a temporary force in New 
York. 

Under the reorganization of the Commission in 1930 a system 
was adopted whereby each investigation is handled by a subcom¬ 
mittee of one or more commissioners selected by the chairman. 
When available, two commissioners are named for each investiga¬ 
tion — one a Republican, the other a Democrat. At the conclusion 
of an inquiry these subcommittees report to the full commission, 
which in turn passes upon the final report to be made to the 
President. 

The professional, technical, and administrative staff includes 
twenty units, five headed by the chief economist, the chief investi¬ 
gator, and the chiefs of the economics, international relations, and 
legal divisions, who assist in all investigations. General service 
to all investigating units is also supplied by accounting, statistical, 
and transportation divisions. There are also the following eight 
divisions of technical experts, based on groupings in the tariff act: 
agricultural, ceramics, chemical, lumber-paper, metals, sugar, 
textile, and sundries. These units perform the basic field and office 
work in securing the primary data for each investigation. 

When an investigation is determined upon by the commission, 
it is referred at once to the appropriate group of technical experts, 
and, if products of a European nation are involved, to the office at 
Brussels. Where commodities involve countries in the South 
American area or in the Far East, it is necessary to send out inves¬ 
tigators, as no offices are maintained in these regions. 

In the case of American products the investigators obtain their 
data largely from trade associations and industries, and have found, 
in general, ready cooperation. In addition to the actual production 
costs, transportation and other costs, markets in the United States, 
and other facts that constitute an advantage or disadvantage in 
competition must be obtained. Such a study requires much 
research. 


386 ECONOMICS OF CLOTHING AND TEXTILES 


In the quest for similar information about articles produced in 
foreign countries the Tariff Commission makes no secret investiga¬ 
tions, but approaches first the governments for permission to deal 
with producers and trade associations and other agencies. Where 
foreign products are involved there must also be collected data as 
to the transportation costs to the principal competitive markets 
in the United States as well as any advantages granted to foreign 
producers by a government, corporation, or association. 

Under the law, where the production costs abroad are not 
“ readily ascertainable,” the commission is permitted to accept as 
evidence invoice prices or the average wholesale selling prices. 
There have been instances where such prices, which include the 
profit of the producers, have been considered sufficiently low to 
warrant a change in a tariff schedule. 

QUESTIONS 

1. How does localization of certain textiles make competition impos¬ 
sible ? 

2. Why is it valuable to this country for us to become acquainted with 
French silks and English cottons? 

3. In what textiles do the following excel: Ireland, Austria, Germany, 
Russia, Holland, Belgium, Switzerland, England, France? 

4. Discuss the production of cotton in the United States. 

5. Compare the suitability of cotton and linen for clothing. 

6. How is Dacca muslin made ? 

7. Trace the history of wool. 

8. Name five countries which produce wool and five which do not. 
Tell why in each case. 

9. How are goatskins made ready for market by the breeder? 

10. How does the jobber in goatskins protect himself from financial loss ? 

11. How did England build up her textile industry? 

12. Compare the United States and England as to methods of building 
up trade. 

13. What do you think of a prohibitive tariff as applied to the textile 
industry? 

14. Give the arguments for the doctrine of comparative costs. 

15. Do you recommend the establishment of a free port zone in the 
United States ? 

16. How has the intergovernmental debt question affected trade? 

17. Criticize the suggested policy for international trade. 


CHAPTER IX 


MONEY AND CREDIT 

Definition. We have defined money as a medium of exchange 
or means of payment. It is valuable because it is accepted by all 
in exchange for goods and services. While it is not of itself wealth, 
it is a symbol of the wealth that can be received in exchange for it. 

Use. While at one time all trading in commodities was carried 
on by means of barter, such direct trading is now used only in rare 
instances, as in times of depression when money is very scarce. 
Thus farmers may exchange produce directly for necessary services 
or manufactured products. Barter is not practical for general use 
because it is impossible always to know the exact number of times 
one article is worth another article. Units of equivalent value are 
not always available for a transaction. With the introduction of 
money, it became much easier to carry on trade and to express the 
value of commodities on a common basis of comparison. 

The importance of money to an industry such as the clothing 
industry is very great. It is used not only by the consumer to 
purchase the wearing apparel, but also by the producer to buy 
his raw materials, to pay his laborers, etc. In the case of most 
manufacturers and traders the transactions involve such large 
amounts that it is not practical to use actual currency for payment. 
Instead, transactions are carried on by a system of credit, or on a 
“ promise to pay ” basis. There is not sufficient money in existence 
for all exchange transactions to be carried on by means of cash 
money payment. If money were required for all transactions in 
the clothing and wearing apparel industries alone, business would 
be greatly delayed at every point. The value of credit in facilitat¬ 
ing the processes of exchange and the basis for credit will be de¬ 
scribed in more detail (see page 393). 

Money in the popular sense is anything that will buy commodi¬ 
ties or services. Under this definition we can include coins, bank 

387 


388 ECONOMICS OF CLOTHING AND TEXTILES 


bills, checks, etc. The technical definition for money is that it is 
the medium of exchange that by common consent meets commer¬ 
cial obligations. When exchange was carried on with wampum, 
wheat, or other commodities as a medium of measurement, such 
articles were then money. 

In addition to serving as a medium of exchange, money serves 
as a standard of value — that is, the value of all other commodities 
can be expressed in terms of money. Money is also valuable as a 
standard of deferred payment. If a person purchases something on 
credit, the seller wishes to know in what form the debt will be paid 
and what its purchasing power will be. Money also serves as a 
store of value; it does not deteriorate like perishable wealth — 
grain or textile products, for instance. 

Stable Money. One of the most important necessities for 
the business of a country is a stable standard of value in the 
monetary system. It must be approximately the same today, 
tomorrow, and in the distant future in order that business may be 
carried on with a certain assurance. If the standard value of the 
medium of exchange fluctuates greatly, prices will likewise vary 
greatly from time to time, affecting the purchasing power of 
money. The business man must be able to know the cost of his 
product in order that he may obtain an equivalent value for it in 
the future. A working man wishes to know that his savings will be 
worth as much ten years from now as they are today, 

In order to obtain this high degree of stability in a money com¬ 
modity, it is necessary to select some medium of exchange that is rel¬ 
atively constant in quantity, or that does not vary greatly over short 
periods of time. In general, the following characteristics are re¬ 
quired for a commodity that is to be used for money: (1) it must 
have a value as a commodity, that is, a usefulness aside from its 
value as money; (2) it must have high value in small bulk, so that it 
can be easily carried and transported; (3) it must be durable; (4) it 
must be capable of being divided into both large and small units; 
(5) it must be of uniform quality; (6) it must be easily recogniz¬ 
able ; (7) it must be easily coined; and (8) it must have distinct 
stability of value due to a certain regularity in production. 

Gold and Silver. Gold and silver have been found to possess 
most of these qualities in the highest degree and are now used for 


MONEY AND CREDIT 


389 


money in almost every country in the world. Most large countries 
use gold as money, while the Oriental, South American, and some 
smaller countries use silver. Both gold and silver, like other 
commodities, have their value raised or lowered as the supply 
increases or decreases. As the value of gold falls, prices will rise, 
and as the value of gold rises, prices tend to go lower. The same is 
true of silver in those countries that use silver. 

The production of gold, silver, or any other commodity can not be 
set by governmental bodies or legislatures. It would be possible 
only if all the governments of the world were to act jointly and 
regulate the output of gold per year, tending to prevent any great 
change in the supply and thus in its value. Then, the prices of 
standard wearing apparel and other commodities would hardly 
decline or advance, supply and demand then becoming the chief 
determining factor of value and so of price. 

Gold as a standard has, among the many advantages that can 
not be advocated for other substances, the prime requisite of 
safety, in that the supply is unlikely to be suddenly increased by 
any amount that could cause large or sudden fluctuations in its 
relative value. To illustrate: If an amount of gold equal to the 
total life-production of any one mine anywhere were suddenly 
to be added to the world’s supply, it would have little or no unbal¬ 
ancing effect upon relative values. 

Gold is a safe standard because the cost of mining it plus a fair 
interest on the capital invested in its production is about equal to 
its value. While this is true to a very large extent, the fact that 
there are natural restrictions or limitations to the amount of its 
production is gold’s paramount attribute as a money standard. 

Bimetallism. Such is not the case with silver or with any other 
substance which could be used as a standard for money. As for 
bimetallism, or the use of both gold and silver, it has been tried 
repeatedly without success. It has been tried with silver; it has 
been tried with wheat; but prices will not remain stable. We can 
keep to the gold standard or we can go upon a silver standard, but 
we can not do both without disaster; and the reasons for the failure 
of bimetallism are readily apparent. First, during the last 65 years 
the annual production of silver has varied greatly, but has always 
been far ahead of the gold production. As a result, no definite 


390 ECONOMICS OF CLOTHING AND TEXTILES 


ratio of the quantity (and so of the value) of silver to gold could 
be maintained for any length of time. With a very few exceptions 
(notably during the World War) silver has constantly tended to 
decrease in value with respect to gold. Second, it is a well-estab¬ 
lished monetary principle that a cheaper money tends to drive a 
higher valued money out of the market. This principle is called 
Gresham’s Law. This being the case, the more valuable gold 
would be hoarded, and only the cheaper silver would circulate. 
As a result, a mono-metallic system would be in operation with 
the cheaper money as a base. 

Furthermore, silver itself is largely a by-product metal. The 
opening up of any single new large producer would be a disaster to 
the silver market, as the demands are adequately supplied already 
from by-product sources, and the few mines that produce silver 
exclusively do so because of extraordinary richness of the ore. 
There are tons and tons of silver all over the world awaiting the 
chance to glut the markets as soon as the price is realized that 
would recompense for the labor of taking it from the mines. 

The gold standard provides a currency system in which the unit 
of value, be it the dollar, pound, or franc, in which prices and wages 
are customarily expressed and in which debts are contracted, con¬ 
sists of the value of a fixed quantity of gold in a free gold market. 

Legal Tender. Any kind of money which the law states must be 
accepted in payment of a debt is said to be legal tender. The 
United States has, by act of Congress, proclaimed the following 
kinds of money to be legal tender: (a) gold coins to any amount; 
(b) silver dollars in any amount (unless otherwise limited in a con¬ 
tract) ; ( c ) gold certificates; ( d ) United States notes (except for 
payment of customs duties and interest on the public debt). Fed¬ 
eral Reserve and other bank notes are legal tender to the govern¬ 
ment. Half dollars, quarters, and dimes are legal tender only up 
to ten dollars, while nickels and one-cent pieces are legal tender up 
to the amount of twenty-five cents. Actually, any money in the 
United States will in ordinary times be accepted in payment of 
an obligation, because of public confidence in the government’s 
promise to maintain it at its face value. 

Fiat Money. Fiat money is paper money which a government 
is unable or unwilling to redeem in legal tender coin. It has been 


MONEY AND CREDIT 


391 


made legal by law, but is not convertible. The Continental 
Congress currency issued during the Revolutionary War is an 
example of fiat money in this country. The greenbacks issued 
during the Civil War were fiat currency for a number of years, but 
they were made convertible by act of Congress in 1879. There is 
no fiat money in the United States today. 

The history of the money system of every country shows that 
paper money must be supported or be convertible into legal coin 
of the country, which is either gold or silver, or else its face value 
will depreciate. Of course, in times of stress — war, depression, 
etc., — the country may issue paper without the support of gold 
or silver. This is usually intended as a temporary measure. While 
it may be done to a slight degree in times of depression in order to 
ease the money market, nevertheless prices will automatically rise 
and a nation will find it is impossible to pay foreign debts. With 
the increase of fiat money a reduction of purchasing power takes 
place. 

Inflation and Deflation. If we think of our gold dollar as a yard¬ 
stick of value, and represent the value or purchasing power of this 
dollar over commodities at wholesale in the year 1926 by a length 
of 36 inches — that is, a yard — the length of this yardstick of value 
would have been as follows for the dates specified: 


1896. 

.77 inches 

1913. 


1920. 

.23 inches 

1921. 

.37 inches 

1929. 

.37 inches 

March 1932. 

.55 inches 


When the yardstick shrinks, we have inflation, the rising cost of 
living, and excesses in speculation; and when the yardstick expands, 
we have deflation, depression, and unemployment. Inflation helps 
the debtor at the expense of the creditor, the exporter at the expense 
of the importer, the speculator at the expense of the man with a 
fixed income, the capitalist at the expense of the laborer. Defla¬ 
tion, on the other hand, works just the opposite. Both inflation and 
deflation are bad. 

Demand and Supply. Since money is to be valued not for itself 
alone but for what it will do, it is possible that we can have too much 








392 ECONOMICS OF CLOTHING AND TEXTILES 


money when there is little money work to be done. Similarly, we 
can have scarcity of money if there is much money work to be done. 
Like any other commodity, money may be cheap or dear. Its 
value (in terms of purchasing power) is determined by the law of 
supply and demand. If the supply of money — that is, the amount 
of money and the rapidity of its circulation, and the use of credit — 
is greater than the demand, then its value will be low and prices 
will naturally rise. On the other hand, if the demand for money 
is great, — because of a large quantity of commodities, such as 
textiles and wearing apparel, that are produced and sold, — then 
the value of money will be great and prices of other commodities 
will fall. For instance, suppose a yard of broadcloth woolen fabric 
is worth $5 during normal times. Let us assume that for some 
reason the demand for money itself (not commodities) becomes 
great. Obviously it will then be necessary to offer more than one 
yard of the same material to induce a person to part with $5. Thus 
if two yards are given, the price of the material has fallen one-half, 
and the cloth is worth only $2.50 per yard because the money is 
twice as valuable. But if the demand for money decreases, 
increasing the supply, the yard of cloth becomes more valuable than 
the money and its price will rise proportionably. 

Quantity of Money. There are in circulation in the United 
States about $5,500,000,000. This consists of various kinds of 
paper money and of coins of silver, nickel, and copper, which the 
national government is obliged by law to maintain at a parity with 
gold. About 90 per cent, however, of the total volume of business 
in the United States, which in a normal prosperous year amounts to 
something like a trillion dollars, is performed by bank deposits 
circulating by means of bank checks. 

Our bank deposits normally amount to over $50,000,000,000, of 
which about $25,000,000,000 are payable by check. This volume 
of checking deposits circulates in a normal year, through check 
payments, on an average of thirty to forty times. Yet the value 
of every dollar of our paper money and the value of every dollar 
payable by bank check is equal to the value of a gold dollar. Hence 
anything that affects the value of the gold dollar affects the value 
of all money with which this tremendous amount of business is 
being done and in which all of our debt obligations are expressed. 


MONEY AND CREDIT 


393 


Credit. Credit implies permission to use another’s money or 
capital, and carries with it the right of the owner of the capital to 
receive it back at some future time together with interest. The 
purpose of credit is that the one who borrows may use the capital 
to better advantage than the one who loans. To illustrate: A 
mill sells a large quantity of sheeting; the payment is delayed, 
but the mill receives a written promise to pay. This credit is 
necessary in order that the purchaser may have time to sell part of 
the sheeting and thus receive funds to pay the manufacturer. 
The promise to pay is called a note. 

Credit is based upon the promise to pay (either implied or 
expressed) and its sole purpose is to save the use of money. In busi¬ 
ness today we find six forms of credit: (a) book credit, ( b ) promis¬ 
sory note, (c) the bank check, (d) draft or bill of exchange, (e) trade 
acceptance, (/) bank notes and government notes. 

Book Credit. Most textile houses offer, customers the privilege 
of purchasing various items during the month, each item of which is 
recorded in a book, and once a month a statement of the amount 
owed is sent to the customer and a check or cash is returned to 
cover the amount of the account. Such a method is called book 
credit, and saves the use of money by postponing the time of pay¬ 
ment to an early date in the following month. 


$ _ New York, _ 19 - 

_ after date _ promise to pay to 

the order of -----—- 

___ Dollars 

at ------- 

Value received 

Due _____ ____ 

Promissory Note 

Promissory Note. In the book credit there is a verbal under¬ 
standing or contract, but in many cases, particularly where the 
amount of each item is large, it is advisable to have a written 

















394 ECONOMICS OF CLOTHING AND TEXTILES 


agreement entered into by both parties. Such a written agreement 
is called a promissory note, and the one who issues the note is 
called the maker and the party who receives is called the payee. 
The note promises to pay for value received a sum of money on a 
certain day in the future. The promissory note saves the use of 
money by postponing the payment to a future date, and also 
allows the payee to sell the note to a third party by writing his 
name or endorsing the note in favor of the one who buys it, called 
the endorsee. The note may pass by endorsement through many 
hands. 


No New York,_193- 

Textile Trust Company i <>» 

350 BROADWAY 

Pay to the 

order of_____$- 

__Dollars 

PAYABLE THROUGH NEW YORK CLEARING HOUSE 


Bank Check 

Check. Practically all bills or accounts are paid by check, that 
is, a written order (by one, called a depositor, who has an account or 
sum of money to his credit in a bank) on the bank to pay on demand 
to a third party, called the payee, the sum written on the check. 
The check, like the note, may by endorsement pass through many 
hands before reaching the bank for final payment. The check also 
saves the use of money. 

Draft or Bill of Exchange. In case the payment, or exchange of 
money, is to be made at a distant community or foreign country, 
a more formal paper than a check must be used, called a draft or 
bill of exchange. If the money is to be paid to one in a foreign 
country, as in the case of international trade, then a foreign draft 
or bill of exchange is used. The draft is simply a written statement 
by which the creditor orders his debtor to pay a sum of money to 
a third party on demand or at a future date. The draft or bill of 








MONEY AND CREDIT 


395 


exchange may pass from hand to hand, like the check, and each time 
it changes hands it saves the use of money. 


_193 __ 

pay to the 


Dollars 

Value received and charge the same to account of 

To _ 


Draft 


$ _ New York,. 


Order of. 


Trade Acceptance. A special form of draft or bill of exchange 
which is very common in the textile business is called a trade 
acceptance. Practically all manufacturers, wholesalers, and job¬ 
bers of wearing apparel must wait some time after they sell the 
goods before they receive payment. Of course, they would like to 
receive all or even part of their money on delivery of the goods, but 
experience shows that they must wait until some, if not all, of the 
goods are sold to the consumer. This usually requires as long as 


No.. 


19. 


To ___ 

On _ Pay to the order of. 


_ Dollars (S _) 

The obligation of the acceptor hereof arises out of the purchase of goods from the drawer. 
The drawee may accept this bill payable at any bank, banker or trust company in the United 
States which he may designate. 


Accepted at - on - 19 - 

Payable at. - Bank 

Bank Location - 

Buyer’s Signature --- 

By Agent or Officer - 


By 


Trade Acceptance 
































396 ECONOMICS OF CLOTHING AND TEXTILES 


90 days. So manufacturers and selling agents are obliged to 
extend terms of payment on goods, called credit. 

In order that the manufacturer or wholesaler may do business, 
banks have developed the form of a bill of exchange called a trade 
acceptance. This allows the manufacturers or wholesalers, on 
receipt of the goods by the purchaser, to present the trade accept¬ 
ance when properly signed to the bank and receive credit for the full 
sum minus the interest on the amount until the date of maturity. 

The bank is protected by the buyer’s signing or accepting the 
bill of exchange, in which he promises to pay the bill at maturity. 
Of course if the buyer fails to pay the bill at maturity, then the 
bank will demand the money from the manufacturer or the party 
selling the goods. 

A bill of lading or a warehouse receipt may also serve as a credit 
instrument, being handled similarly to the trade acceptance. 


TEXTILE TRUST COMPANY 

350 Broadway 

New York,—- 193 — 


A_Draft on you for $-drawn by 

Note 

__ has been regularly presented at your 

office for payment. It will be held at this office (at the collection window) until close 
of banking hours this day. (Office closes 3 p.m. Saturday 12 m.) 

Our messengers have no authority to make promises or waive instructions. 

Cash or certified check to order of _ 

“ Textile Trust Company ” required Messenger 

This notice to be returned to the Textile Trust Company with payment 


Bank Notice to Debtor 

Bank Notes and Government Notes. The ordinary bills used as 
money in everyday life in this country are called bank and govern¬ 
ment notes, which are founded on the United States of America’s 
promise to pay, and which pass from one person to another as 
money and represent a form of credit. 

Foreign Obligations. When one attempts to pay a bill for goods 
contracted in a foreign country, the difficulties are greater than in 
paying the bill in the same country. To illustrate: Suppose we 










MONEY AND CREDIT 


397 


wish to pay the bill of a French mill for delivery of 100 yards of silk 
at 26.5 francs a yard. We must first consider the currency of each 
country. The franc is the French and the dollar the United States 
unit. The franc is equal to a certain weight of gold and the 
dollar is also valued at a certain weight of gold. If the American 
dollar were to be changed into francs, the dollar would be worth 
about 15 francs. That is, there is as much pure gold in a French 
franc as there is in 6.66 cents of an American dollar. This equiva¬ 
lent is known as the mint par of exchange, or the mint par. It is 
around this figure that the price of the franc, in terms of cents, will 
fluctuate. 

In paying the above bill in gold, the American would have to 
send to Paris gold to the value of $397.88. But the amount of 
gold to be sent to France will cost him more than $397.88. There 
is the additional expense of assaying to determine its purity, plus 
the cost of packing, freight, insurance, and the loss of interest 
on the gold while in transit. 

If it is possible to purchase a draft on Paris, similar to the pur¬ 
chase of a draft between two cities in the United States, and the 
cost of the draft is less than the cost of shipment of gold, then of 
course the draft will be purchased. Therefore the cost of shipping 
gold, called gold points, limits the amount to be charged for the 
draft to France. The merchant will select the method that is the 
cheapest, unless the government prohibits exporting of gold or 
discourages the export of gold by placing obstacles in the way of 
the exporter. 

Banks. Since money is loaned and credit obtained through 
the medium of the banking system of the community, it is desirable 
to understand the organization and functioning of that system. 

The capital fund available for purposes of loan depends in a large 
degree on three factors : (1) the productiveness or earning power of 
the people, (2) the thrift of the people, and (3) their desire or 
willingness to save. In other words, the available loan fund 
represents the savings of those persons who deposit their surplus 
money in the bank. The bank is then enabled to allow others to 
borrow these funds. 

Banks were first established in the industrial cities of northern 
Italy during the Middle Ages by money lenders who safeguarded 


398 ECONOMICS OF CLOTHING AND TEXTILES 


Rates of Foreign Exchange 

Quotation on sterling represents dollars and decimals of a dollar; all others 
represent cents and decimals of a cent. 

Parity of the exchanges in the following tabulation is based on the new gold 
value of the United States dollar as established by Presidential proclamation 


on Jan. 31, 1934. 

Europe 

Year 

Ago 

Sterling — Par $8.2397 per sovereign. 

Demand. . . . $5.08 $3.45f 

Australia — Par $8.2397 per sover¬ 
eign. 

Demand... . 4.06f 2.76| 

South Africa — Par $8.2397 per sov¬ 
ereign. 

Demand.... 5.10 3.48 

France — Par 6.6335 cents per franc. 

Demand.... 6.58 3.96f 

Germany — Par 40.3325 cents per 

Demand.... 39.72 23.87 

Italy — Par 8.91112 cents per lira. 

Demand. . . . 8.57 5.12 

Belgium — Par 23.5419 cents per 
belga. 

Demand.... 23.31 14.101 

Austria — Par 23.8244 cents per 
schilling. 

Demand.... 19.00 14.05 

Czechoslovakia — Par 50.0165 cents 
per crown. 

Demand. . . . 4.16 2.97f 

Denmark — Par 45.3740 cents per 
krone. 

Demand. . . . 22.68 15.49 

Finland — Par 4.2642 cents per fin- 
mark. 

Demand... . 2.26 1.52 

Greece — Par 2.1973 cents per 
drachma. 

Demand.94^ .57 X V 

Holland — Par 68.0567 cents per 
florin. 

Demand.... 67.27 40.591 

Hungary — Par 29.6125 cents per 
pengo. 

Demand. . . . 29.62 17.45 

Norway — Par 45.3740 cents per 
krone. 

Demand. . . . 25.53 17.79 

Poland — Par 18.9938 cents per zloty. 

Demand. ... 19.00 11.18 


Year 

Ago 

Portugal — Par 7.4831 cents per 
escudo. 

Demand.... 4.67 3.18 

Rumania — Par 1.0127 cents per leu. 

Demand. ... 1.02 .60 

Spain — Par 32.6693 cents per peseta. 

Demand. .. . 13.63 8.49 x 

Sweden — Par 45.3740 cents per 
krona. 

Demand.... 26.20 18.441 

Switzerland — Par 32.6693 cents per 

Demand.... 32.31 19.68^ 

Yugoslavia — Par 2.9820 cents per 
dinar. 

Demand.... 2.28 1.35 

Canada 

Montreal — Par $1.693125 per Cana¬ 
dian dollar. 

Demand.... 99.87 86.12 

Mexico 

Mexico, D. F. — Par 84.40 cents per 
silver peso. 

Demand.... 27.90 29.00 

Far East 

China — Cents per silver dollar for 
Hongkong and Shanghai. 


Hongkong — 

Demand.... 39.19 22.94 

Cables .... 39.25 23.00 

Shanghai — 

Demand. .. . 35.19 29.44 

Cables .... 35.25 29.50 

India — Calcutta: Par 61.7978 cents 
per rupee. 

Demand.... 38.31 26.19 

Philippine Islands — Manila : Par 50 
cents per silver peso. 

Cables .... 50.37 49.75 


MONEY AND CREDIT 


399 


Year 

Ago 

Java — Par 68.06 cents per florin. 

Cables .... 67.50 40.50 

Japan — Par 84.3957 cents per yen. 
Demand.... 30.06 20.94 


South America 

Argentina — Par 71.8724 cents per 
Argentine paper peso. 

Demand. . . . 34.00 25.69 

Brazil — Par 20.2550 cents per paper 
milries. 


Year 

Ago 


Demand. ... 8.50 7.45 

Chile — Par 20.5990 cents per gold 
peso. 

Cables _ 10.25 6.12 

Colombia — Par $1.6479 per gold 
peso. 

Cables .... 72.00 88.50 

Peru — Par 28 cents per sol. 

Cables .... 25.00 16.25 

Uruguay — Par $1.7510 per gold peso. 
Demand.... 80.00 47.25 


the money of neighbors in their strong compartments, called safes. 
The money lenders found by experience that (a) their neighbors 
usually left a large part of their deposit on hand and seldom drew 
out all their money, and ( b ) that it was possible to lend a part of 
this money for short periods, provided they had a reserve sufficient 
to meet the everyday demands. The money-lenders or bankers 
also found that it was possible for them to issue notes — bank 
notes or promises to pay on demand — on the security of the 
amount of money on hand. They also found that many people 
would not ask to have these notes redeemed, but would circulate 
them. Hence the money-lenders or bankers could determine 
approximately the amount of reserve to keep on hand to meet pay¬ 
ment of notes and to pay depositors. Gradually arose the custom 
of allowing depositors to draw checks on banks against the amount 
of their deposit on hand. Thus arose the main functions of bank¬ 
ing : (1) receiving deposits of money, (2) loaning money, (3) issuing 
bank notes or promises to pay the value of notes when pre¬ 
sented. 

There are today many types of banks. We may classify them 
according to (a) source of authority and regulation or (6) kind of 
business transacted. The first classification divides banks into 
National banks or State banks according to their source of power. 
The National banks secure their authority from and are supervised 
by the United States Government. The State banks secure their 
charters from the State authorities. 

According to the type of business transacted, State banks may 
be divided into (1) savings banks, (2) trust companies, (3) commer¬ 
cial banks, (4) investment banks, and (5) private banks. 


400 ECONOMICS OF CLOTHING AND TEXTILES 


National Banks. Shortly after the formation of our government 
the first Secretary of the Treasury, Alexander Hamilton, saw the 
need of a bank to: (1) regulate the currency, (2) receive deposits 
from the public, (3) act as an official agent of the government in 
financial matters. Hence in 1791 the Bank of the United States 
was established in Philadelphia with branches in other parts of 
the country. It had a capital stock of $10,000,000, of which 
$2,000,000 was held by the government and the rest by the 
public. The bank held a charter for twenty years. 

The charter was not renewed in 1811, due to the crisis of the 
War of 1812. Its value and importance, however, were readily 
recognized so that a second bank was chartered in 1816. After a 
very slow start, the Second Bank became successful and flourishing. 
It became a political issue, and fell into the disfavor of President 
Jackson, who refused to renew its charter in 1836. Thus ended a 
most stabilizing influence in early American financial history. 

As the country was in the midst of a very prosperous business 
era, and banks were a recognized necessity, numerous State banks 
were immediately organized. Unfortunately many of the pro¬ 
prietors of these banks were inexperienced, and all too often their 
intentions were not exactly honest. There developed the period 
of “ wild-cat” banks, ending in the panic of 1837. Then followed 
a period of well-regulated State and private banks, many of which 
survive to the present day. 

During the Civil War in 1863, a number of National banks were 
formed, patterned in part on the old national banks. In fact, any 
five people could organize a National bank on the following condi¬ 
tions : (a) One-third of the capital must be invested in government 
bonds. The bank was allowed to deposit the bonds with the 
government and receive against them National bank notes equal to 
100 per cent of their value. Thus the banks receive interest on the 
bonds and also circulate the bank notes. (6) The banks are subject 
to examination by government inspectors and stockholders are 
subject to double liability on the amount of stock held. 

The following list of services of the larger National banks will 
illustrate the scope of their influence in the carrying on of business : 

(a) Deposits are received, subject to withdrawal by check, and 
monthly statements are rendered of such accounts. 


MONEY AND CREDIT 


401 


(b) Approved commercial paper is discounted for customers and 
loans are made on satisfactory collateral at current interest rates. 

(c) Notes, drafts, coupons, and other items are collected, both in 
this country and abroad, for the account of customers. 

(d) Individuals, firms, corporations, and trustees may place 
temporarily idle funds in certificates of deposit, on which interest 
is paid from the date of deposit to the date of withdrawal. 

(e) The credit department provides information to customers 
concerning the credit standing of business concerns in any part of 
this country. 

(/) Saving deposits may be made, beginning to draw interest 
at the end of each month. 

(: g ) Safe deposit service, with modern vaults for the protection 
of valuables and securities, is maintained. 

(h) They offer facilities for the prompt and efficient handling of 
every phase of international banking business — such as com¬ 
mercial letters of credit, acceptance financing, foreign collections, 
foreign exchange, foreign credit information, and close relations 
with foreign banks. 

(i) They issue letters of credit, under which drafts may be 
negotiated throughout the world, making it possible to cash drafts 
at foreign banks. This is the best way to carry substantial sums. 

Notes and the Discount Function. A promissory note is a paper 
signed by the borrower promising to repay money borrowed 
(called the face of the note), stating the rate of interest, to whom 
payable, and the time and place of payment. Notes are due at 
the expiration of the specified time. 

The rate of interest varies at different times and in different 
parts of the country. The United States government usually has 
to pay about 2 per cent or 3 per cent. Savings banks pay 3 per cent 
or 4 per cent. Individuals borrowing on good security pay from 
4 per cent to 6 per cent. 

In order further to secure the safety of the loan, the borrower, 
called the maker of the note, often has a friend approve or endorse 
by signing his note. The endorser must usually own property, and 
if the maker can not pay the note at the end of the specified time, 
the endorser is notified by written order, called a protest, and is 
called upon to pay it. 


402 ECONOMICS OF CLOTHING AND TEXTILES 


A borrower is asking a great deal when he asks another man to 
sign a note for him. Unless a person has more money than he 
needs, it is better business policy to refuse the favor. It is wise 
always to be sure that one knows exactly what he is signing and 
understands the responsibility attached. 

Workings of a Bank. As previously explained, a depositor 
leaves money at the bank for safe keeping. The bank agrees to 
return a part or all of the money on demand. The bank may under 
certain conditions credit the depositor’s account with any interest 
that has been earned. 

The following outline covers the workings of a National bank: 

(a) Merchants deposit in the bank their receipts of each day. 
With a slip of paper marked to show the contents of the deposits, 
the money with the slip is presented at the bank window. The 
teller or clerk compares the amount received with the record on the 
deposit slip. If correct, the amount deposited is entered in a 
depositor’s book called a pass book and held by the depositor. 

( b ) The amount of the deposit slip is credited by the bank book¬ 
keeper to the account of the depositor. 

(c) The depositor pays his bills by checks drawn on the bank. 
(The bank gives each depositor a book of blank checks.) Each 

AUTHORIZED SIGNATURES OF 


Account No_ 

The depositor agrees that all dealings and relations with the Trust Company 
shall be governed by the rules and regulations set forth in the pass book. 

Address 

Business 

TEXTILE TRUST COMPANY 

350 BROADWAY, NEW YORK,-193 


Depositor’s Signature Card Kept by the Bank 

check is made out with the (a) amount, (b) date, (c) name of the 
person to receive the money, and (d) signature of depositor, or 
payer of the check. 









MONEY AND CREDIT 


403 


Check. The check is used by the depositor to pay some bill or 
account. It is either cashed or deposited by endorsement on the 
reverse side by the person who receives it. The check finally 
reaches the home bank of the depositor, where it is charged against 
his deposit and kept on file until the end of the month, when the 
depositor’s account is balanced and paid checks returned to the 
depositor. 


This pass-book will be used only 
as a receipt for deposits, and is not 
to be balanced, and need not be 
left for that purpose; instead a 
statement of your account will be 
rendered with your canceled 
vouchers. 

The right is reserved to require 
five days’ notice prior to with¬ 
drawals of deposits. 

All items with the exception of 
currency are received for deposit 
and credit, subject to payment 
and collection and drafts against 
same are payable in current funds 
through the New York Clearing 
House. 


Textile 

Trust Company 


DEPOSITED IN 

Textile Trust 
Company 

350 BROADWAY 
BY 


NEW YORK_ 193_ 

All items deposited except currency, are re¬ 
ceived subject to collection and payment and 
the conditions printed in the depositor’s pass 
book. 

Until actual payment is received by this 
company all items credited may be charged 
back to depositor’s account. 


Bills, 


DOLLARS 


CENTS 


Coin, 


Checks, 


KINDLY ADVISE US PROMPTLY 
OF ANY CHANGE OF ADDRESS 

Notice on Pass Book Cover Deposit Slip 

Clearing House. Checks drawn by a depositor are frequently 
offered for deposit at a bank remote from the place of business of 
the issuing bank; not infrequently they are mailed to distant cities. 
It is apparent that if it were necessary to return the check directly 
from the bank receiving it to the one upon which it is drawn, 
considerable expense would be involved in the operation. To 
complicate matters further it must be borne in mind that often mil¬ 
lions of checks totaling billions of dollars are offered for payment 












404 ECONOMICS OF CLOTHING AND TEXTILES 


daily throughout the country. To facilitate the rapid and accurate 
handling of such a heavy volume of business, banks in a neighboring 
area, usually a large city, organize what is known as a Clearing 
House Association. Only highly reputable banks are permitted 
to enter, and the standards for continued membership are rigidly 
enforced. 

The operation of the clearing house is very simple. Each 
member bank in a district is given an identifying number which 
appears upon the face of every check issued on that bank. At the 
conclusion of the day's banking business, all checks are sorted in 
piles according to the bank of issue. Naturally checks drawn upon 
the accounts of its own depositors are immediately charged to the 
individual's account. If funds are sufficient to meet the check, 
proper entries are made, and the check is canceled and filed in the 
bank folder of the depositor who signed the original check. If 
drawn upon a branch bank, it is sent to the office of that branch 
and handled as above. 

There remain the checks drawn upon other banks, all sorted in 
piles. These are totaled, bundled, and the next morning at a 
stated time, usually about 10 o'clock, a representative of that bank, 
with his assistants, appears at the clearing house with all the 
bundles. Each bank has a small office, occupied by the bank's 
representative. These offices are usually arranged in a large 
semicircle and in numerical rotation according to the clearing¬ 
house numbers of the banks. At a signal, the assistant begins to 
distribute to each of the other banks the packages of checks he 
has for them, accepting a receipt for the total supposed to be in the 
bundle. This operation is completed in a few minutes for all the 
banks. The two representatives then inspect the checks and verify 
the total for which they have signed. Let us assume that bank 
No. 1 had checks totaling $100,000 for bank No. 2, and that the 
latter had a total of $80,000 for bank No. 1. Obviously bank 
No. 2 owes bank No. 1 a total of $20,000 for that day's transactions. 
A clearing-house check for that amount is given No. 1 at once, 
and the clearing is complete. The clerks now return to their own 
bank and proceed to charge each check to the proper account. 
In case a check must be returned for any reason, as insufficient 
funds, forgery, improperly drawn, errors, etc., the check is stamped 


MONEY AND CREDIT 


405 


with the reason for return and passed back at the next clearing, 
being handled as a regular transaction in the opposite direction. 
Banks in New York City clear twice daily. 

Checks drawn upon banks in other cities are transmitted by the 
clearing house to the clearing house in that city for collection. 
In cases where a bank is not a member of the clearing house, a 
member bank usually agrees to be its correspondent and accept 
responsibility at the clearing house for its checks. 

Bank Reports. Each bank issues a financial statement at 
stated times. The following will assist one in interpreting a bank 
statement: 

1. The capital of a bank is the amount raised by the sale of its 
stock to stockholders. The cash is called assets and the bank owns 
the capital stock. What the bank owes are called liabilities. 

2. The bank does business in a building with proper equipment 
and furniture. It would naturally buy the furniture and equip¬ 
ment and in some cases the building from the cash assets, and the 
real estate, furniture, etc., become assets, and the remaining cash 
becomes a cash reserve fund. 

3. As each new depositor places his deposits, the sum total of 
deposits becomes a liability, since they must all be repaid in due 
time. 

4. As each check is received and cashed, the deposits become less 
as the amount of each check is subtracted. 

5. As the bank loans money or discounts notes, the assets are 
increased by the amount of loans and discounts, while the amount 
of discount is placed against liabilities as undivided profits. 

6. As securities are bought with cash reserve, the assets are 
credited with securities. 

7. As soon as the discount amount is increased sufficiently, a 
certain portion is set aside as surplus, not to be divided to stock¬ 
holders, but retained as a capital reserve. 

Weakness. The National bank system, organized in 1863 for 
the purpose of providing a market for government bonds and also 
to create a uniform currency, was safe but lacked flexibility. In 
other words, in times of crisis the banks were unable to stand 
together, and it was difficult to increase the supply of bank notes 
when needed. Each National bank attempted to secure as much 


406 ECONOMICS OF CLOTHING AND TEXTILES 


cash as possible in time of crisis, and this was reflected in shifting 
bank deposits and business. To correct this weakness the Federal 
Reserve bank was established in 1913, as the foundation stone of 
our National bank system. 

The Federal Reserve bank is a system of member banks con¬ 
trolled and supervised by the Federal Reserve board. It is not a 

TEXTILE TRUST COMPANY 
NEW YORK 


Statement of Conditions March 31, 1934 
Resources 


Cash on Hand and in Federal Reserve Bank. 

Cash in Depositary Banks . 

United States Government Securities. 

Municipal and Other Readily Marketable Short Term Obliga¬ 
tions . 

Demand Collateral Loans to Brokers. 

Loans Eligible for Rediscount with Federal Reserve Bank . 

Other Demand Loans with Collateral. 

Loans and Discounts. 

Loans on Real Estate. 

Investments: 

Federal Reserve Bank Stock . . . $195,000.00 

Other Investments. 862,214.66 


$8,073,291.05 

3,401,764.57 

9,827,954.63 

5,908,601.55 

3,858,043.19 

4,000,000.00 

3,478,564.84 

15,447,369.69 

911,315.74 


1,057,214.66 


Banking House, Vaults, Furniture and Fixtures .... 820,312.35 

Accrued Interest Receivable and Other Assets. 199,928.54 

Customers’ Liability on Acceptances. 803,608.49 


$57,787,969.30 


Liabilities 

Capital Stock.$3,000,000.00 

Surplus and Undivided Profits. 2,728,049.85 

Reserves. 189,757.25 

Acceptances Executed or Endorsed. 847,563.09 

Deposits: 


Demand.$48,826,766.02 

Time. 2,195,833.09 51,022,599.11 


$57,787,969.30 


Bank Report 

bank in the strict sense of the word, but a super-bank for banks to 
do business with and not for individuals. 

The country is divided into twelve banking districts. All 
National banks must belong and State banks and trust companies 

























MONEY AND CREDIT 


407 


are invited to become members of the system. Membership is 
granted by paying cash into the treasury of the local Federal 
Reserve bank to the extent of 6 per cent of the member’s capital 
and surplus. 

The Federal Reserve bank in return (a) lends credit to member 
banks in the form of Federal Reserve notes, (6) serves as a deposi¬ 
tory of the gold money reserve of the country, (c) acts as a clearing 
agency for their members, ( d ) is a custodian of government funds, 
(e) deals in bills of exchange, bullion, and governmental ob¬ 
ligations. 

By rediscounting — one of the great privileges of belonging to 
the Federal Reserve system — a local bank may increase its 
credit by discounting at the district Federal Reserve bank the 
promissory notes, drafts, bills of exchange, etc., that it has accumu¬ 
lated from the various business men to whom it has extended 
credit. The district Federal Reserve bank will discount these 
papers at a slightly lower rate than the member bank had done, 
and pays for them Federal Reserve notes which enable the member 
bank to make additional loans to its clients. This process is called 
rediscounting and applies to banks that have reached the limit 
of their lending power, and where there is a demand on the part of 
business for additional loans. This system provides for absolute 
safety and creates a greater flexibility of currency, especially 
at times when business is brisk and the demand for ready money 
is great. 

Credit Function. One of the principal functions of a National 
bank is the credit function based upon the promissory note of a 
business house. The note is discounted, and the difference between 
the face of the note and the discount is credited to the account of 
the business man. He draws against this account for necessary 
purchases — as machinery, raw materials, etc. — and is able to 
pay promptly with a check, and this usually increases his credit 
rating. 

To illustrate: A mill treasurer wishes to borrow $100,000 for a 
mill that manufactures ginghams. The money is to be used to buy 
cotton and other raw materials, and to pay the wages of the mill 
employees regularly each week during the period of manufacturing 
and selling the product. The note is a contract to pay to the bank 


408 ECONOMICS OF CLOTHING AND TEXTILES 


in 60 days the sum borrowed — $100,000. The mill may offer 
as security for the loan some of the mill stock, a mortgage on the 
mill property, or bonds. In case the money is not paid at the 
specified time, the note may be extended, or the bank may sell 
the collateral — that is, the stocks, bonds, etc., offered as security. 

When the mill treasurer borrows the money, he does not receive 
the $100,000, but the balance remaining after the interest at 6 per 
cent for 60 days has been deducted from the $100,000 — or a net 
of $99,000 — is credited to the mill account at the bank. This is 
called discounting the note. The $99,000 credited to the account is 
called the proceeds of the note. 

The mill treasurer may write checks for a total of $99,000 in 
payment for raw cotton, wages, etc. In addition, the fact that he 
has a deposit of $99,000 in a bank gives him a favorable financial 
rating in the business world, so that firms will sell him machinery 
and supplies with sufficient time to pay for them. 

As fast as the finished fabrics are sold, the treasurer receives 
checks in payment for them, and deposits these checks to his 
credit in the bank, so that by the time the note falls due he will 
have sufficient funds to his credit to repay the $100,000 by drawing 
a check to the bank for this amount. 

Thus the bank in granting loans also makes credit deposits. 
Eventually, when the bank is functioning in prosperous times, it 
loans more money than it possesses. Of course we must bear in 
mind that not all business men are borrowing at the same time. 
Many are depositing, so that the bank is obliged in prosperous 
times to keep only a limited amount of cash on hand to meet the 
needs of depositors. 

Banks also assist mill men, textile manufacturers, and others by 
collecting for them the checks, bills of exchange, bank drafts, etc. 
(called commercial paper), that are deposited to their accounts. 
Of course, the promissory notes, etc., which are not rediscounted 
at the Federal Reserve bank are kept by the bank until the date 
of their retirement (date of maturity) and then are presented by the 
bank to the persons (debtors) for payment. 

National banks also have the right to issue bank notes (promises 
to pay), which are used in the community as money for the purchase 
of goods. The Federal government imposes definite restrictions 


MONEY AND CREDIT 


409 


upon National banks as to the amount of bank notes that may be 
outstanding. 

Since a bank must keep on hand sufficient cash to meet the 
demands of the depositors, it follows that an adequate amount, 
called the reserve fund, must be kept in every bank. The ratio 
between this reserve fund and the demand liabilities — that is, 
cash on hand and the demand deposits — is called the reserve ratio. 
It is expressed by a percentage obtained by dividing the cash on 
hand by demand deposits. A ratio of 1 to 5 or 1 to 10 is usually 
considered a safe ratio. This means that the bank has $1.00 
in its cash reserve for every $5.00 or $10.00 (as the case may be 
— 1 to 5 or 1 to 10) it owes its depositors. The bank’s reserve 
ratio may be expressed in the form of an equation, as follows: 

. _ cash on hand + cash due from other banks 
eserve ratio deposits -f- bank notes in circulation 

When the bank loans textile manufacturers and others money, 
the credit deposits increase, but the cash does not increase in the 
same ratio, and this makes the reserve ratio smaller. Raising the 
rate of discount and limiting the loans will assist the bank to main¬ 
tain a safe reserve ratio. If business is poor and few loans are 
being made, the reserve ratio will tend to increase. A bank may 
also control its reserve ratio by buying or selling securities or by 
rediscounting its notes. 

It is necessary for textile manufacturers and others to provide 
a continuous maximum supply of textile fabrics and wearing 
apparel to meet the demands of society. One of the functions of 
money is to provide a medium of exchange for the purchase of 
textiles and wearing apparel. Since there is not a sufficient cash 
medium of exchange to carry out the transactions to meet the 
needs of society, the banks supply by credit the funds to carry on 
the business. 

Therefore, the amount of money and credit in a community or 
country must be flexible, expand when business requires more 
money, and contract when the requirements have decreased, else 
there will be either not sufficient money or too much money to carry 
on the exchanges. This means that the prices of textiles and 
other goods will either fall or rise, affecting certain groups of society 
to such an extent as to make them suffer. 



410 ECONOMICS OF CLOTHING AND TEXTILES 


It follows that the banking system should provide an elastic 
or flexible system of credit and currency that will expand or con¬ 
tract in accordance with the business needs of the country, so 
that the price level will remain stable. The National and Federal 
Reserve banks can do this through the system of loans and redis¬ 
counts which has been briefly mentioned previously. 

Rediscounts. This plan operates as follows: Assuming that 
business in the textile industry is rapidly advancing, the manufac¬ 
turers and merchants need to buy more raw materials, supplies, 
machines, etc. In return for the borrower’s notes secured by 
collateral, the banks will advance lines of credit for 60- or 90-day 
periods. As more and more commercial paper is being discounted, 
the ratio of cash to deposits is sinking lower until the legal reserve 
limit is reached. To make further loans, additional cash reserve 
^necessary. Under the Federal Reserve system this is secured by 
the member bank sending some of its discounted commercial paper 
to the district Reserve bank for rediscount, and the account of the 
member bank is credited with the equivalent cash. In this way 
the district Reserve bank renders the same service to the member 
banks that these banks perform for their borrowers. As the 
rediscount rate is generally lower than the regular discount rate, 
such transactions can be very profitable. To supply the cash 
requirements of their customers, the member bank receives from 
the district bank Federal Reserve bank notes which are supported 
by the rediscounted paper. 

As business declines, the demand for loans decreases and out¬ 
standing loans are gradually repaid. As the rediscounted loans 
come due, the member bank can repay these by offering either new 
paper or Federal Reserve Bank notes. By using the latter, the 
central bank can retire from the currency any excess money then 
in circulation in response to the general business demands. 

The effectiveness of this system was thoroughly tested during the 
period of violent inflation up to the middle of 1929, and then again 
through the period of depression that followed. A few minor 
improvements were suggested by the Congress of 1931-1932. The 
central banks can effectively control over-expansion if they wish to 
use their power by raising the rediscount rate to a point where it 
discourages care-free borrowing. 


MONEY AND CREDIT 


411 


When all is said and done, the success of any bank or banking 
system depends entirely upon the honesty, integrity, good business 
judgment, knowledge of particular business problems, and a wealth 
of understanding of human nature on the part of the management of 
the bank. By sacrificing extra profits for assured safety, avoiding 
questionable business contacts, although venturing further when 
an enterprise seems reasonably certain of success, a bank can 
render a most valuable and profitable service to the community 
and nation. 

Textile Credit. When the National Bank Act allowed any five 
people to organize a bank under the government, it was very 
natural that a group of each industry would organize a bank for its 
own trade interest, such as a Textile National Bank, Leather 
National Bank, etc. Each bank would become expert in dealing 
with the peculiar financial problems of that trade and be able to 
give better financial service than other banks. 

Many of the National banks in the South have helped to finance 
cotton since 1865, and have always considered it a duty and a 
privilege to extend their facilities in support of the South’s chief 
product. In 1932 financial support appeared necessary to prevent 
“dumping,” which generally has the tendency further to depress 
the price. To prevent this unsatisfactory state and aid in the 
orderly marketing of the cotton crop, and at the same time to 
release a good portion of the market value of the crop to growers 
and to their local banks and merchants, the First National Bank 
of Atlanta and its banking group announced that they would be 
glad to extend to growers, directly if desired, — but preferably on 
applications coming through their local bank, — loans on cotton 
on the following basis : 

1. The cotton to be independently stored in warehouses satis¬ 
factory to the banks and bearing the approval of the Federal 
Reserve bank. 

2. The banks would lend 80 per cent of the market value of the 
cotton on tenderable grades only, proper margins to be maintained. 

3. Grades and weights of the cotton were to be indicated. 

4. The cotton was to carry specific insurance. 

5. The rate of interest would be 5 per cent; time, 4 to 6 
months. 


412 ECONOMICS OF CLOTHING AND TEXTILES 


Such a step is a rather radical departure in American banking 
practice but clearly indicates that the banks are willing to lead 
the way to improved business methods wherever they can. This 
plan will be watched with great interest by all banks and by other 
industrial groups. 

The United States government is very anxious to uphold the 
credit of our banking system, hence it allows the National banks 
to issue National bank notes and the Federal Reserve banks to 
issue Federal Reserve bank notes, but insists on a 10 per cent tax 
to the Federal government on any notes issued by State banks. 
This step is necessary, as the Federal government exercises no 
direct control over State banks. Because of this rather excessive 
tax the State banks do not issue notes, as it would be unprofitable 
for them to do so. Our currency is thus completely under Federal 
control. 

State Banks. Banks chartered by the State, such as (a) savings, 
(6) trust companies, (c) commercial banks, ( d ) private banks, — 
perform many services that are very useful to the community and 
the trade. 

Savings Banks. A very useful form of banking is that carried on 
by the savings bank. Individuals called depositors place their 
money in a savings bank for safe keeping and for interest. The 
bank makes its money by lending at a higher interest than it pays 
its depositors. Interest on deposits is generally paid for specified 
periods, frequently quarterly or semi-annually, although in recent 
years many savings banks have paid interest from date of deposit 
to withdrawal. The interest is generally at a conservative rate, 
fluctuating with business conditions. Often in the same commu¬ 
nity there may be a slight variation in the rate of interest paid 
by different banks. 

Every bank is obliged to open its books for inspection by special 
officers who are appointed for that work. If these men did their 
work carefully and often enough, there would be almost no chance 
of loss by depositing money in a savings bank. Banks fail when 
they lend money to too many people who are unable to pay it back, 
or when the bank finds it difficult to sell or otherwise liquidate the 
collateral or security held against the loan. Such collateral is 
spoken of as a “frozen asset.” 


MONEY AND CREDIT 


413 


Almost every community has a savings bank that encourages 
working people to deposit small amounts of money and receive 
interest. This money is loaned in large amounts on mortgages to 
build houses, roads, schools, etc. Of course interest is an incentive 
for people to save. As a rule, the savings of a community or 
country tend to increase as the rate of interest increases. A rising 
rate of interest provides a larger supply of loanable capital. 

Men save to provide for old age, sickness, unemployment, or some 
other definite purpose. They think of future wants. People may 
place their savings in a bank where they receive interest, or they 
may hide them away — hoard them — in a vault or safety-deposit 
box, or in some unsuspected place. In fact, the desire to save for 
future wants is so great as to impel many people to save regardless 
of the interest return. 

It is not only desirable to increase one’s earning capacity, but also 
to develop systematically and regularly the saving habit. A dollar 
saved is much more than two dollars earned. A dollar put at 
interest is a faithful friend, earning twenty-four hours a day, while 
a spent dollar is like a lost friend — gone forever. Histories of 
successful men show that fortune’s ladder rests on a foundation of 
small savings; it rises higher and higher by the added power of 
interest. The secret of success lies in regularly setting aside a 
fixed portion of one’s earnings, for instance 10 per cent; better 
still, 10 per cent for a definite object, such as a home or a com¬ 
petency. Of equal importance with systematic saving is the 
prompt reinvestment of interest earnings, especially during the 
years of productive income. 

In every community one will find various agencies by which 
savings can be systematically encouraged and successfully pro¬ 
moted. These institutions promote habits of thrift and encourage 
people to become prudent in the use of money and time. They 
help people to buy or build homes for themselves or to accumulate 
a fund for use in an emergency or for maintenance in old age. 

Savings banks have to perform an extremely important duty. 
They are trustees of people’s hard-earned money. It is the prime 
duty of savings banks to protect this trust. What a man wants 
above all else when he puts his money in a savings bank is safety 
and protection for that money. It is seriously doubted whether 


414 ECONOMICS OF CLOTHING AND TEXTILES 


depositors of this kind are much interested in the amount of interest 
they get so long as they get a little, and can really feel free from 
worry that their money might be in danger. 

The savings bank is not adapted to the needs of those with large 
sums to place at interest. It is a place where small sums may be 
deposited with a high degree of safety, earn a modest amount, 
and be used by the depositor at short notice. The savings bank 
lends money on bonds or mortgages and receives about 5 per cent. 
It pays its depositor from 3 per cent to 4^ per cent. The difference 
goes to pay expenses and to provide a surplus fund to protect 
depositors. 

The question may be asked, “Why can not the ordinary depositor 
lend his money on mortgages and receive 5 per cent?” He can if 
he is a capable judge of financial values and is willing to assume the 
risks. When he receives 4 per cent interest at the savings bank, he 
is paying 1 per cent to \\ per cent in return for reasonably assured 
safety and freedom from the necessity of selecting securities and 
keeping the money employed. 

A mortgage is the pledging of property as a security for a debt. 
If Mr. Allen owns a dress store and needs some money to buy a 
stock of goods, he may go to Mr. Jones and borrow $1000 from him. 
Mr. Jones will require him to give as surety a mortgage on his 
store or the stock of goods. This means that Mr. Allen agrees 
that if he is unable to repay the $1000, the store or stock, or such 
part as is necessary to cover the debt, shall be turned over to Mr. 
Jones for disposition. 

Under present law if a man wishes to foreclose a mortgage, — 
that is, compel its payment when due, — he can not appropriate the 
property for himself, but it must be sold at public auction. From 
the money received at the sale to the highest bidder the man who 
holds the mortgage, called the mortgagee, receives his full amount, 
and anything that is left belongs to the man who owned the 
property, known as the mortgagor. 

Investing money, like everything else worth while, requires 
planning. It requires planning ahead to get the money to invest. 
Every one who desires to invest should have a systematic plan of 
saving for the accumulation of investment money. The savings 
account should be used as a continuous means of saving, with the 


MONEY AND CREDIT 


415 


view of investing part of the fund from time to time as it reaches 
substantial proportions. 

In considering the investment of savings, one should consider 
the savings bank as the outstanding investment trust that has 
stood the test of years, bringing together the savings of large 
numbers of people and investing them in only the highest grade 
securities. 

It is well to have a clear understanding of just what “invest¬ 
ment” means. “Investment” is not “speculation.” People often 
confuse the two. Investment implies the return of all of the 
money, plus a reasonable income paid regularly. Speculation 
implies certain risks of the principal for the sake of a higher income 
or larger profit on the transaction. Speculation may be successful, 
but it is often unsuccessful and too often disastrous. 

By far the most important thing to secure in investing money is 
the safety of the principal. United States Government bonds 
do not pay 6 per cent for just one reason — because many people 
are willing to lend the government money at a lower rate. The 
same principle applies to all concerns that offer securities to the 
public. If their securities are high grade, they can get money at 
a relatively low rate. If their securities involve a greater factor of 
risk, they will have to pay a higher rate of interest. In the matter 
of bonds or similar investments the difference in safety governs the 
difference in the return. 

There are approximately 400,000 corporations in the United 
States, representing every variety of business enterprise. These 
corporations, whose stock and bond issues total many billions of 
dollars, are financed largely by funds supplied by the investing 
public. According to the Investment Banker’s Association, more 
than 80 per cent of the new enterprises fail or suffer severe losses, 
while 10 per cent are pure fake schemes. 

A bond represents a debt of the corporation and generally is 
secured by tangible property; stock is not secured by tangible 
property but represents part ownership in a business, the value 
and relative strength of the stock depending upon the successful 
management of the business. 

Commercial Banks. We have already stated that the commer¬ 
cial banks, including the State and National banks, are the most 


416 ECONOMICS OF CLOTHING AND TEXTILES 

numerous type of banking institutions and that they exercise the 
greatest influence in the business world. Commercial banks exist 
to serve the financial needs of the business community by perform¬ 
ing such functions as receiving daily deposits, cashing checks, dis¬ 
counting notes, bills of exchange, and trade acceptances. They 
may perform other services for their customers, but their chief func¬ 
tion is in supplying credit through the discounting of what is known 
as commercial paper — notes, etc. 

These institutions loan money for a short time, 90 days or less, to 
textile and other merchants or business men. They really supply 
a large part of the capital to carry on the business needs of textile 
and other industries. Thus commercial banks, the most important 
in our present economic organization, are engaged primarily in the 
double function of receiving deposits and issuing loans. They 
receive deposits for safekeeping, and then issue them to others in 
the form of loans, thus redistributing capital funds into channels 
most useful to the development of business enterprise. In this 
manner they bring together the surplus savings of individuals and 
form a large capital loan fund that can be used in financing indus¬ 
trial establishments, public improvements, etc. 

Investment bankers are those who sell large amounts of corpora¬ 
tion securities and naturally influence financial affairs. Seldom 
do they receive deposits or discount notes. They concern them¬ 
selves largely with the financial structure and organization of the 
larger business or corporate enterprises. Management and control 
also become important factors in their financial arrangements. 
The sums of money involved are usually very large, often running 
far up in the millions. The financing may take the form of a 
capital investment or a long-term bond issue. 

Private bank is a term applied to a commercial bank conducted 
by a single person or a partnership and not by a corporation. 
Private banks usually perform the same general functions that are 
undertaken by regular commercial banking houses. At one time 
these banks were very popular, but recently they have almost 
disappeared. Many of these private banks are located in large 
foreign population centers, catering to the complete financial 
needs of those particular people. All too often the proprietors of 
these banks have been unscrupulous and losses have been frequent. 


MONEY AND CREDIT 


417 


As a result, most States, particularly where large foreign centers 
are located, have made it increasingly difficult for such banks to 
continue operation. Several investment bankers and also depart¬ 
ment stores operate very successful private banks. 

Trust Companies. A trust company is an institution which 
devotes its principal attention to trust service for individuals and 
corporations. It offers, among others, the following services : 

(а) Acts as executor of estates under wills. The advantages of 
having an institution with a trained staff act in this capacity are 
being more generally recognized. 

(б) Acts as trustee under wills and voluntary agreements. Vol¬ 
untary or living trusts are constantly being executed in great variety. 

(c) Receives securities on deposit for safekeeping, collects the 
income and credits the amount for the account of the depositor, 
relieving him of the necessity of clipping coupons and filling out 
the forms required for collection. 

(d) Acts as administrator, and as agent for executors, adminis¬ 
trators, and trustees. While such persons can not delegate their 
responsibility of decision, they wish to use bank facilities for attend¬ 
ing to the details of administration, and receive the benefit of infor¬ 
mation and advice on investments. 

(e) Acts as guardian for minor children and conservator for 
incapacitated persons. 

(/) Acts as transfer agent and registrar for the transfer and 
registration of stocks; and as registrar for bonds and notes of 
corporations and associations. 

(j g ) Acts as fiscal agent for the payment of bonds, coupons, and 
dividends. 

(h) Acts as trustee under mortgages. 

(i) Acts as depository under reorganizations, escrow agreements, 
and contingent contracts. 

Exchange. Another function of the commercial bank is the 
handling of various kinds of bills of exchange, etc. The process of 
making payment at a distant place without the risk and expense of 
sending money itself is carried on in various ways. Funds may be 
remitted from one place to another in the same country in seven dif¬ 
ferent ways : postal money order, express money order, telegraphic 
money order, bank draft, check, sight draft, and registered mail. 


418 ECONOMICS OF CLOTHING AND TEXTILES 


A post office money order is a sight draft upon a particular 
branch office of the post office department. It is secured at a 
local post office in amounts ranging from one cent to $100 after an 
application has been duly filed and the face value plus a small fee 
has been paid. Large amounts require the issuance of several 
$100 orders. The order is then sent as regular mail and cashed by 
the receiver either through his bank or the post office. 

An express money order is similar to a postal money order, but 
may be drawn for any number of dollars at the same rate as the 
post office order. This is issued at express offices. 

A telegraphic money order is an order drawn by a telegraph agent 
at any office, instructing the agent at some other office to pay the 
person named in the message the sum specified. The rates are 
high, and in addition one must pay the actual cost of sending the 
telegram according to distance and number of words. 

A bank draft is an order written by one bank directing another 
bank to pay a specified sum of money to a third party. This order 
looks much like a check. 

A check is an order on a bank to pay the sum named and deduct 
the amount from the deposit of the person who signs the check. 

A sight draft is an order on a debtor to pay to a bank the sum 
named by the creditor who signs the draft. 

Money may be placed in a heavy envelop; sealed and sent as 
registered mail. In this case the post office guarantees the safe 
delivery of the contents. 

Foreign exchange is a system for transmitting money to another 
country. By this means the people of different countries may pay 
their debts. The bills of exchange used for this process were 
described in the preceding chapter. 

For an ordinary traveler doing business in a foreign country, the 
most common means of paying for purchases abroad are either 
letters of credit or traveler’s checks. 

A letter of credit is a circular letter issued by a banking house to 
a person who desires to travel abroad. The letter directs certain 
banks in foreign countries to furnish the traveler such sums as he 
may require up to the amount named in the letter. Suppose a 
traveler with a letter of credit for $25,000 purchases $5000 worth 
of merchandise at Munich. The Munich correspondent bank 


MONEY AND CREDIT 


419 


would indicate this sum upon the face of the letter. If later addi¬ 
tional purchases are made, the paying banks will note the amount 
involved directly on the letter. When the final payment has been 
made, the last bank returns the letter of credit to the issuing 
bank. 

Frequently a traveler abroad will purchase at his local bank or 
traveling agency what are known as traveler’s checks. These 
are generally standard amounts that correspond to the paper cur¬ 
rency in this country. At the time of purchase, the buyer writes 
his signature upon the face of the check. When he comes to settle 
for a bill abroad, he signs the check in another space provided for 
that purpose and a comparison of signatures will serve as a means 
of identification. These checks often serve as currency where the 
local currency is not very stable. 

Postal Savings. The Federal government, in order to encourage 
the spirit of thrift and to overcome the lack of confidence that 
foreigners and others may have in the general banks, has estab¬ 
lished a postal savings bank in post office buildings. The amount 
allowed to be deposited is limited, and the rate of interest is small. 
The principal is guaranteed by the government. 

Textile Credit. Some banks specialize in credit extension to 
textile merchants, manufacturers of wearing apparel, etc. They 
build up a group of experts specially qualified to handle the financ¬ 
ing of such loans and thus claim to offer better credit and banking 
facilities to the clothing industry. Thus, the banks of Boston 
extend better credit and banking arrangements to the leather, 
hide, and wool trades than do the banks in New York. Boston has 
thus naturally become the center of these industries, especially 
from the financial angle. 

In times of depression, commercial bankers doing business with 
textile houses become greatly disturbed by the conditions when a 
large production of low-priced goods brings no one profits and 
actually causes many severe losses. This is quite as true of silks, 
woolens, and rayons as of cotton products. The first step in the 
solution of the difficulties within the industry lies in the direction 
of governing production. 

Factoring. The large banks of the country have given only 
limited service to textile merchants, producers, and garment 


420 ECONOMICS OF CLOTHING AND TEXTILES 


manufacturers. This has been due to the fact that the large banks 
have not the technical staff to pass on the question of credit to the 
textile trades. Hence we find banks specializing in textile services 
developing in the great textile and garment centers of New York 
City, and also increased banking with commission houses, called 
factoring. 

We saw in an earlier chapter the way in which a commission 
merchant acts as a selling agent, receiving a commission on the 
sales. Later, certain commission merchants obtained money for 
the mills from the banks by guaranteeing their notes. The term 
factor is applied to the commission merchant who assumes the 
duties of a banker as well as a selling agent. So that today we 
have many well-established firms as factors — that is, acting as 
selling agents and bankers for the manufacturer. This service 
includes furnishing space for display and storage purposes, billing, 
packing and shipping the goods as and when sold, attending to 
all of the details incident thereto, including credit investigations, 
assuming the credit risk on time sales, and paying over to the 
manufacturer the net value of the accounts created upon delivery 
of the goods to the purchaser. In effect, the manufacturer receives 
cash on delivery of goods without risk of credit losses, but through 
the use of the facilities of the factor the customer is granted the 
usual trade terms. 

In recent years the tendency has been toward specialization, 
both in selling and in the extension of credit. Manufacturers have 
found that the results are far more satisfactory if their marketing 
is in the hands of their own selling organization, or selling agents, 
and the banking function delegated to the specialized organization 
of the factor, who has the advantage of experience gained through 
transacting a large volume of business for many mills. A com¬ 
petent factor must be more than a good banker. He must be a 
merchant as well as a banker, and be capable of guiding clients 
around the pitfalls of credits during periods of producing and 
distributing. 

Persons in the trade unfamiliar with the way in which many 
competent textile manufacturers grow from small to large producers 
through being relieved of many credit and financial details that 
are not only expensive but also annoying, have little conception of 


MONEY AND CREDIT 


421 


the magnitude of the business handled. Hundred-million-dollar 
organizations in factoring are no longer uncommon in New York 
City, and the credit ramifications of such large institutions are 
comparable only with the largest commercial banks or distinctly 
credit-reporting concerns. The extent of the service given in this 
part of the business is especially valuable in periods of declining 
trade and highly competitive merchandising. 

The factoring system of assisting merchants is strong in all 
divisions of the textile trade. For many years some houses con¬ 
fined themselves almost exclusively to silk or dress goods. Today 
the same houses handle accounts in linens, cottons, rayons, wool, 
silks, and jute goods, and have been going more and more into 
selected accounts of garment production. Many traders and 
merchants who have made fortunes in textiles have been frank in 
ascribing a large part of their success to the sympathetic and 
cautious guidance of men in factoring institutions, who have found 
time in addition to their regular duties to go over their problems 
with them from many other angles than the primary one of gaining 
a commission for services rendered. 

The factoring field undoubtedly calls for much more training in 
finance and merchandising than many bankers have found necessary 
in the conduct of their particular business. The credit service calls 
for more detailed attention than a host of bankers care to be bur¬ 
dened with in holding their clients. But quite aside from the mere 
cashing of sales or the passing on of credits, the opportunities in the 
field are called limitless by one of the leaders in the business, who 
is conceded generally to be much wiser than the average banker who 
is called on to deal with problems of merchandising. 

Methods of Payment. In cases where the factor merely dis¬ 
counts receivables, the trade debtor repays him in an average time 
of 60 days. In cases where he advances against merchandise, his 
money may be loaned for a period of from two to four months, plus 
an average additional 60 days after the merchandise is sold and 
becomes an account receivable. 

The Call Money Market. When brokers need funds, they go 
to the banks as a general rule, using securities as collateral. There 
are two types of loans made upon security collateral — time and 
call loans. Time loans are made for a specified period, — usually 


422 ECONOMICS OF CLOTHING AND TEXTILES 

three, six, nine, or twelve months, — and at a fixed rate of interest, 
while the call loan is renewed daily at a rate of interest that may 
fluctuate daily. 

Call loans are callable on demand and may be negotiated at the 
“money desk ” on the floor of the stock exchange, or through money 
brokers, or directly between borrowers and lenders. Because of 
the proved safety and liquidity of such loans, excess funds of banks 
all over the nation have been sent to New York to be loaned in the 
call money market. 

Time loans are never negotiated on the floor of the New York 
Stock Exchange, but are made either directly between the borrowing 
broker and the lender, or through money brokers who charge the 
borrower a small sum for their services in obtaining funds. 

Most of the security transactions on the exchange are settled on 
the following business day, which makes it necessary to provide 
to brokers loans which can be terminated at any time. Member 
firms instruct their representatives on the floor of the exchange to 
obtain such loans as they may need, and these are arranged for at 
the money desk. Interest rates depend on supply and demand. 
They are usually low, rating well under the current long-term rate, 
although at times of financial stringency the rates have been above 
20 per cent. 

During the last bull market many corporations loaned funds in 
the call market, having been attracted by the high interest rates. 
These loans were placed through the local banks, which charged a 
small commission for their services. 

The New York Clearing House, however, has ruled that its 
members can no longer place call loans in the market for the account 
of corporations or individuals. The purpose is to keep Wall Street 
credit under closer control by banks. This step does not prevent 
corporations or individuals from placing their funds through private 
banks and non-clearing house institutions. 

When the stock market panic of 1929 first developed, most 
corporations and many of the out-of-town banks took advantage 
of the call feature and demanded their funds at once. The large 
commercial banks came to the rescue of the brokers, however—• 
the funds being supplied indirectly by the New York Federal Re¬ 
serve Bank. 


MONEY AND CREDIT 


423 


Strength in Banking. We must remember that most business, 
particularly in the textile and clothing industry, is done on a credit 
basis. In fact, 95 per cent of the business done in this country is 
done on credit. 

Credit is faith , the foundation stone of successful business, and 
faith in business is maintained by the banking system of the country. 

The banks dominate to a large degree the credit system of the 
community and the country. Therefore, it is essential for pros¬ 
perity — the successful phases of business or economic life in 
production, marketing exchange, and consumption — that the 
banks be conducted by experienced and successful men who have 
sane and progressive business policies and are not influenced by 
psychological changes — fear, etc. 

If fear enters our banking system, the annihilation of credit 
amounting to more than ten times the capital of the banks can 
take place in a very short time. This was illustrated in the de¬ 
pression of 1929-1932. 

In times of depression there is in the banking system of the 
United States an elimination through suspension, consolidation, 
and voluntary liquidation of many weak uneconomic units. This 
has done more to strengthen the American banking structure than 
any of the reform plans so far proposed. 

A reduction from 30,000 to 20,000 in the number of banks in the 
United States during the past eleven years, 1921-1932, has removed 
undesirable elements and causes of weakness that reacted against 
all banking. The result has been to strengthen the remaining 
banks with higher standards of character and soundness. 

These inevitable readjustments have enforced reforms with 
greater thoroughness and effectiveness than could have been accom¬ 
plished through other means, admitting at the same time that 
certain changes in existing laws have corrected some undesirable 
features in banking practice. 

There are about 19,500 institutions at present operating in the 
United States and these should afford ample banking facilities for 
the nation. In 1921 there were far more banks than the nation 
needed. 

In 1931 the banks on the average served the economic activities 
of only about 3500 persons each. The average capital per bank 


424 ECONOMICS OF CLOTHING AND TEXTILES 


was then about $205,000 and the average deposits $1,250,000. 
In 1933 the average capital per bank was about $420,000 and the 
deposits nearly $2,500,000. Total capital funds, which in 1921 
were $6,360,000,000, currently approximate $8,500,000,000. The 
amount at the high point in 1930 was $10,000,000,000. 

Value of Credit. Credit has certain advantages and certain 
disadvantages, all of which should be known so as to secure maxi¬ 
mum economic efficiency from the use of credit. The advantages 
may be summarized as follows : 

(a) Economizes the use of precious metals, thus allowing 
greater use of them in the industries. 

(i b ) It allows capital goods to be converted into purchasing 
power by means of a mortgage on property, which permits one to 
secure money from a bank, individual, etc. 

(c) Cash basis business tends to limit the volume of business. 
Since credit involves only a limited use of money, the credit system 
increases the volume of business. 

( d ) Credit provides a means for successful business men to 
secure capital so as to engage in business and assist society. 

( e ) Small savings placed in many banks become centralized into 
large amounts which are loaned to large productive industries. 

(/) Payments at a distance may be made conveniently and safely 
with credit instruments. 

The disadvantages of the credit system are: 

(a) In the hands of careless spendthrifts credit may lead to 
extravagance by means of installment buying. Extravagance leads 
to the purchase of luxuries and the loss of necessities in order to 
pay for the luxuries. 

( b ) Credit may lead also to over-speculation and expansion of 
business if the banks are willing to loan on easy terms. Money 
obtained easily from the banks leads to abnormal production of 
wearing apparel, etc., in the hope that the goods will rise in price. 
Many times it is difficult to dispose of the wearing apparel, hence 
the business man is unable to pay for the cost of expansion. Fail¬ 
ures of business and banks will follow. 

(c) If excessive credit is given, — that is, above the proper 
amount for the volume of business, — then credit takes the place 
of money, and is said to be inflated, tending to an unwarranted rise 


MONEY AND CREDIT 


425 


in prices. Similar results will follow if the volume of credit is re¬ 
duced proportionally below the volume of business. This is called 
deflation, and results in lower prices. Hence, banks must study 
the volume of business and decide on the proper amount of credit. 
Such a plan will give elasticity to credit so that it will vary with 
rise and fall of business. 

QUESTIONS 

1. Why is barter impracticable for all transactions in the textile 
business ? 

2. Wdiy is credit used so extensively in modern business transactions? 

3 . What is the function of money? 

4 . What are the characteristics of a good money? 

5. How does the value of the standard coinage affect the price of 
commodities ? 

6. Why is a bimetallic monetary system unsuccessful today? 

7 . What do we mean when we say $5 for a hat? 

8. Why is a stabilized currency necessary to the merchant? to the 
worker ? 

9 . Why is gold used as a basis for money? 

10. What has caused many countries recently to go off the gold stand¬ 
ard? 

11. Define fiat money, Continental currency, greenbacks, token 
money. 

12. If a man pays a debt of $500 in pennies, must his creditor accept it? 

13 . If you owed the United States government $137.95, name the 
kinds and amounts of money you might use to pay the obligation. What 
kinds of money could you not use ? 

14 . Describe the various forms of credit used in business transactions. 

15 . What are the main functions of a bank? 

16 . Look up the history of the First and Second National Banks. 
What was the political struggle that resulted in the end of these banks ? 
Would you advocate a strong central national bank today ? 

17 . What provisions make a savings bank a reasonably safe institution 
for the small investor ? 

18 . Distinguish between investments and speculation. 

19 . Describe the various types of banks and their functions. 

20. Explain the functions of the Federal Reserve system. 

21. Explain in detail the operation of the clearing house. 

22. Why should a business man understand fully the meaning of each 
item in a bank statement ? 


426 ECONOMICS OF CLOTHING AND TEXTILES 


23 . Describe in detail the steps followed in borrowing money at a 
commercial bank to finance the purchase of a power sewing machine. 

24 . What is meant by the Reserve rates? 

25 . How does the rediscount function of the Federal Reserve banks 
operate ? 

26 . Clearly distinguish the various methods that may be used to 
transmit funds to considerable distances. 

27 . How may a person intending to travel abroad arrange for the 
payment of his purchases ? 

28 . What is meant by factoring? 

29 . What services may a factor render ? 

30 . Distinguish between a time and a call loan. 


CHAPTER X 


RESEARCH AND INVESTIGATION 

Importance of Research. The economics of clothing has already 
been defined as a study of the way in which man supplies his needs 
and desires for wearing apparel. Since these needs and desires 
are unlimited in scope, it follows naturally that economics should 
be constantly finding new materials, new processes, new uses, etc., 
in order to meet these potential wants. Research and investiga¬ 
tion in the clothing industry are constantly adding to the sum total 
of clothing satisfaction. The progressive development of any 
industry depends upon the constant utilization of principles that 
will improve qualities, discover new uses, etc., so as to satisfy our 
wants. 

Many large corporations and the United States government, 
through the Bureau of Standards, have large staffs of investigators 
and scientists who are applying principles of biology, chemistry, 
physics, psychology, art, sociology, and economics to textiles and 
wearing apparel in order to anticipate and to satisfy our wants. 

Biology is the science of living things, and since the raw materials 
for textiles — cotton, linen, wool, and silk — come from vegetables 
and animals, the principles of biology may be utilized to improve 
and explain the growth of these different fibers. 

Chemistry explains the compositions that are used and changes 
that take place in bleaching, manufacture of dyestuffs, rayons, etc. 

Physics explains the physical properties of fabrics, such as 
mercerization, moisture-taking, luster, color, the principles of 
mechanism, and the use of the machinery in the manufacture of 
the yarn, cloth, etc. 

The application of art will bring out new designs, weaves, and 
lines, as well as new colors of fabrics. 

Study of sociology will bring to our minds the characteristics of 
human nature and show us how to satisfy its wants. 

427 


428 ECONOMICS OF CLOTHING AND TEXTILES 


Economics, as the science of business, will show us the best 
means of producing and marketing wearing apparel and the most 
effective means of extending and increasing credit, so that we can 
give to all the satisfaction of meeting their wants in the highest 
degree possible. 

It is obviously impossible to describe all the developments 
that have been worked out through research in the textile and 
wearing-apparel industries, but we can mention some outstanding 
fields in which progress has been made. 

The study of the growth of cotton and the application of ferti¬ 
lizers, rotation of crops, use of insecticides, and the best staples for 
various uses, give additional opportunities for research in biology. 

The application of principles of physics gives an opportunity to 
use various mechanical laws in carding, spinning, and weaving, so 
as to increase production, improve the quality of the finished 
product, and thus bring down the price and place more textiles and 
other products within the reach of all. 

The development of rayon shows us how it was possible to make 
synthetic fabrics to sell more cheaply. The discovery of merceri- 
zation and other finishing operations gave us an opportunity to add 
new properties to dull fabrics, producing mercerized cotton; and 
schreinerization gives an additional luster to mercerized cotton 
fabrics. The process of bleaching by bleaching powder gave us 
a quick and inexpensive method of finishing cotton fabrics, thus 
increasing their aesthetic appearance. 

The discovery of coal-tar dyes gave us dyestuffs of various 
degrees of fastness and color, placing rich artistic coloring within 
the reach of all at low prices. 

Opportunities still exist for additional research into methods 
of manufacture of ramie, a fiber with some physical qualities 
stronger than other fibers. The study of improving the growth of 
the silkworm offers opportunities in research along biological lines. 

The economics of wearing apparel demands also that each worker 
should be trained technically for his task, so that his skill may be 
developed in the shortest time, to reduce the waste caused by 
inexperience and faulty workmanship. As far as possible, each 
person should be engaged in the type of work adapted to his abilities 
and that offers him the greatest opportunities. Since there are 


RESEARCH AND INVESTIGATION 


429 


various types of workers, it follows that the training may be short 
or long — a week or two, or a year or more, depending upon the 
extent of training necessary for the position. The training of 
workers for the wearing- apparel industry, as for all other industries, 
should be scientifically done, in order not to have an excess or 
a scarcity of workers. 

Coal-Tar Dyes. One of the most important projects of research 
affecting the textile industry has been conducted by the dyestuff 
manufacturers in their development of synthetic dyestuffs from 
coal-tar. The application of principles of chemistry to coal-tar 
products has given us over 10,000 dyestuffs. Some of these have 
taken the place of vegetable dyes. To illustrate: Madder is a 
plant the roots of which, when ground into powder and dissolved 
in water, yield a valuable red dyestuff of the same name, which was 
used extensively up to fifty years ago. The use of madder appears 
to have been known from the earliest times, as cloth dyed with it 
has been found on Egyptian mummies. It was used for dyeing 
the cloaks of Libyan women in the days of Herodotus (450 b.c.), 
and Dioscordes speaks of its cultivation in Caria in 440 b.c. 

The ordinary dyer’s madder grows wild over eastern Europe 
and western Asia. The madder root yields colors of the greatest 
permanence, and was employed in dyeing linen and cotton. Two 
kinds were fixed upon cotton: one is called madder-red, and the 
other, which possesses a much higher degree of luster and perma¬ 
nence, is called Turkey red, because for a long time the madder root 
was obtained from Turkey. In the dye trade, this madder also 
bears the name of alizari, the coloring element being known as 
alizarine. 

Up to the year 1812, madder was extensively cultivated in 
Holland, France, Turkey, and to a small extent in the United 
States. Its cultivation, however, has almost ceased since alizarine, 
the red coloring element of madder, has been made artificially. 

In 1868 two German chemists discovered a method of making 
artificial alizarine from anthracene, one of the products of coal tar 
— a discovery which had the effect of revolutionizing the dyeing 
of calico and other cotton-printing industries. The production of 
artificial alizarine forms one of the most brilliant pages in the 
history of modern chemical achievement. The German chemists 


430 ECONOMICS OF CLOTHING AND TEXTILES 


studying the quinone group of compounds — a group discovered 
shortly before — were led from theoretical grounds to ascribe to 
the alizarine of the madder root the character of a quinone. They 
then proceeded to ascertain the hydrocarbon from which it was 
derived; and on finding this to be anthracene they attempted to 
build up the alizarine from this as a basis. They were highly suc¬ 
cessful. The first patents were taken out in 1868, but the new 
madder substitute did not come into general use until about 1872. 
Anthracene, which formerly was considered a useless by-product 
in the manufacture of gas, was sold at about $2 per ton under the 
name of “green grease,” for use as a lubricant for wagons. Imme¬ 
diately it rose in price, and by 1873 commanded $500 a ton. The 
artificial alizarine has entirely superseded the natural product from 
the madder plant; and the cultivation of madder, which was once 
a great and flourishing industry, has been abandoned. 

Artificial Indigo. Research in the study of coloring compounds 
showed that the indigo of commerce contains varying quantities 
of pure blue coloring matter, ranging from 75 to 80 per cent — or 
in other words, contains from 20 to 25 per cent of impurities. 
These impurities do not contribute to the coloring power; they are 
inert, and naturally in dyeing yarns do not always yield the same 
tone (due to the varying quantities of impurities). This large 
percentage of foreign substances in the natural product greatly 
hinders the usefulness of the dye, often marring the pure color of 
fabrics unless great care and pains are taken in its application. 
Because of these impurities in natural indigo, chemists directed 
their efforts to finding a satisfactory substitute. This they finally 
discovered in experimenting with coal-tar products, and artificial 
indigo derived from this source is rapidly taking the place of the 
natural indigo derived from plants. Scientific tests have shown 
conclusively that artificial indigo is identical in chemical composi¬ 
tion with the indigo of commerce. 

Cotton Research. As a result of the study of soil chemistry, and 
of insect pests that tend to destroy the cotton plant, it has been 
possible greatly to increase the yield of cotton. The Cotton- 
Textile Institute was organized in July, 1926, by the cotton mills of 
this country, to provide a single agency for the comprehensive 
study and analysis of cotton and its development and marketing. 


RESEARCH AND INVESTIGATION 


431 


Since its organization in April, 1927, the New Uses Section of 
the Institute has conducted more than 130 separate studies of new 
or extended uses of cotton. It has surveyed the opportunities for 
developing export trade; it has undertaken technical research 
through a research associate assigned to the Bureau of Standards in 
Washington; it has facilitated the development of simplification, 
standardization, and specification. One of its principal activities 
recently has been the direction of a comprehensive promotional 
campaign in behalf of styled cottons, by means of which the 
Institute was able to stimulate very greatly the demand for fine 
cotton goods for apparel purposes in 1932. 

Through its cost-engineering department, the Institute has 
made a thorough analysis of cost accounting in several groups of 
mills and has published an outline of this study, stressing the 
sound basis for predetermining fabric costs. 

In certain of its groups the Institute has been instrumental 
in formulating codes of sound trade practices. Through a series 
of conferences it has undertaken a study of distribution'methods, 
and proposes to develop still further information in this most 
important field. From the outset, the Institute has encouraged 
cooperation with other associations in the industry, and the 
nature of its market studies has brought it into close relation 
with the representatives of a number of associations represent¬ 
ing other industries, as well as those governmental agencies 
interested in promoting the prosperity of the cotton-textile 
industry. 

In all of its work the Institute has sought to be a continuing 
stimulant to more critical and constructive thought within the 
industry. It is, and probably will continue increasingly to be, an 
educational influence, and improvement of merchandising has been 
definitely stimulated by the study and analysis the Institute has 
given to these matters. 

The Institute has made many suggestions to cotton growers, 
such as: Southern growers should not only reduce their acreage, 
but should improve the vacated land with fertilizers, and the 
planting of other forms of farm products to bring a halt to the 
declining fertility of the soil. If such steps are taken, the South 
can increase the cotton productivity of each acre to such an extent 


432 ECONOMICS OF CLOTHING AND TEXTILES 


that this country will be able to produce the staple at prices with 
which the rest of the world can not compete. 

Experts in southern agriculture state that if the southern cotton 
grower practiced rotation of crops, fertilized adequately, and 
cultivated efficiently, he could produce on the average twice as 
much cotton per acre as at present. The land over a large part of 
the cotton belt has been robbed of its fertility during the past 
twenty or thirty years through failure to practice crop rotation 
and to apply the right kinds and right quantity of fertilizer. 
Cotton growing is a seasonal occupation, which requires intensive 
work at certain periods of the year, but does not take up the 
grower’s time during the rest of the year. On an average the cotton 
grower does not work on his crop more than perhaps 40 or 45 per 
cent of the year. It would be generally agreed that a manufacturer 
whose plant produced only half as much as it was capable of pro¬ 
ducing', whose machinery was allowed to deteriorate over a quarter 
of a century, and whose organization worked 40 or 45 per cent of 
the year could not hope to meet competition and stay in business. 

Alabama’s cotton improvement campaign added $2,000,000 to 
the value of the crop in 1931. This increase is based on the fact 
that 37 per cent of the 1930 crop was untenderable (staple length 
shorter than seven-eighths of an inch) and that in 1931 this figure 
was reduced to 7.9 per cent. In amount, this meant 545,750 bales 
of untenderable cotton in 1930 and only 112,000 in 1931. The 
difference in amount, multiplied by the increased value created by 
improving the length and quality of the staple, revealed that the 
gain exceeded $2,000,000. The improvement campaign is designed 
to eradicate inferior grades of cotton in the State. 

Cooperating with farmers, ginners held special gin days for the 
improved varieties of cotton, saving more than 1,000,000 bushels 
of seed, or enough to plant one-third of the 1932 crop. 

The chart of activities of the New Uses Section of the Cotton 
Textile Institute presents five important phases of its work. 

1. Research Work. This work is centered about the activities of a 
research associate maintained by the Institute at the Bureau of Standards, 
where studies are undertaken to develop and prepare fabrics for specific 
uses through fundamental investigations on yarn, on effects of different 
twists, weaves, and finishes. 


RESEARCH AND INVESTIGATION 


433 


2. Industrial Promotion. In cooperation with individuals, mills, trade 
associations, bureaus and agencies of city, county, state, and national 
governments. The services of the Institute are made available for 
increasing the use of cotton fabrics in industrial channels; to design new 
weaves to meet new demands and conditions in industry; to assist in 
the preparation or revision of purchasing specifications. 

3. Style Promotion. Style promotional activities of the Institute are 
carried on through the following media: Trade consumer advertising, 
style bulletins, swatch books, trade and casts, motion pictures, cooperative 
promotion and pattern companies, educational work with important 
consumer groups. 

4. New Uses Committee. The Institute enjoys the active cooperation 
of the Department of Agriculture and the Department of Commerce in 
the development of present and new uses of cotton, and assists other 
government departments, bureaus, etc., in providing for special textile 
requirements. 

5. Publicity. The advantages of cotton fabrics are presented to the 
public through addresses, radio broadcasts, motion pictures, exhibits, 
special articles, statements to the newspapers, trade and technical pub¬ 
lications, consumer magazines, etc. 

In 1929 members of the New Uses staff traveled 50,000 miles, 
addressing more than 1,000,000 persons at special meetings by 
radio, etc. 

Campaigning for styled cottons in 1929 took positive form in 
fifteen advertisements in consumer fashion magazines, 180 adver¬ 
tisements in cotton and dry goods trade publications, sixty talks 
and exhibits at meetings of home economics teachers in schools and 
universities and other consumer groups, sixteen talks to important 
trade groups, such as retail stores’ sales staffs. 

Almost 200,000 copies of the Institute’s style bulletin, Flashes 
of Fashion, have been distributed in fourteen issues. The present 
circulation per issue is now in excess of 21,000 among retail 
buyers, stylists, fashion editors, and important consumer group 
leaders. 

Not only continued interest but much more active interest in 
styled cottons on the part of retail merchants is already discernible 
in the current season in advertisements. 

Research on Knitted Fabrics. Considerable study of the prob¬ 
lems of weighting and stretching of circular knit rayon underwear 


434 ECONOMICS OF CLOTHING AND TEXTILES 


cloths in now being done. Marked difference of opinion concern¬ 
ing the problem is noted among the knitters, some feeling that no 
more weighting is used than the slight percentage necessary in 
finishing. These knitters dismiss the anti-weighting campaign 
initiated by leading retailers as propaganda. Others are strongly 
insistent that goods should be labeled as to the amount of weighting 
used for each width of cloth. 

Still others blame some of the larger knitters for the development 
of a weighting problem, declaring that the policy of some firms has 
been a steady grading down in an effort to undersell the rest of the 
market. Some knitters also complain that they have no assurance 
that their customers will not forget to label cloth as weighted, even 
when the knitter is most careful to label his product properly. 
They hold that the weighting problem is one for the underwear 
cutter to solve rather than one which should be considered by the 
cloth manufacturer. The final solution of this argument will prob¬ 
ably depend on further study of the problem. 

Mechanical Preparation of Flax. For the first time in the 
history of mankind, the slow and difficult processes of preparing 
flax fiber by hand have been completely transformed by mechanical 
means in the State of Oregon. Today in the United States fiber 
of highest quality is being prepared mechanically for linen manu¬ 
facture in a fraction of the time and at one-fourth of the cost re¬ 
quired heretofore. This means a revolution in the age-old flax 
fiber industry of the world, and the dawning of a new day for the 
struggling linen industry of America. And to Oregon, most recent 
of flax-producing districts, belongs the glory of this achievement. 

This is the only place in America where linen products are being 
manufactured entirely from home-grown flax. It is the only place 
in America where the long “line fiber” that goes into linen 
manufacture is now produced. It is the only place in the world 
where hand labor has been almost completely replaced by mechan¬ 
ical power in the harvesting and processing of flax without injur¬ 
ing the quality of the fiber. 

Now that Oregon has learned how to produce high-grade line 
fiber by mechanical means, it is an industry that can spread through 
the North Pacific coast, the Great Lakes States, and the North 
Atlantic coast wherever the climate is moderately cool and humid. 


RESEARCH AND INVESTIGATION 


435 


In all of these regions fiber flax has been grown successfully, but 
never developed for textiles because of the laborious and costly 
hand labor involved. 

Some of the flax produced in Oregon seems to be fully equal to 
the medium grades of the flax retted in Belgium (where the 
world’s best fiber is prepared). Probably the greater proportion 
of it will average as good as or better than the average of the flax 
fiber imported from Russia and the Baltic states, where the greater 
portion of the world’s fiber is produced. 

To realize what this means, it is necessary to understand some¬ 
thing of the difficult processes of fiber preparation. To produce 
the long line fiber required for linen manufacture the crop can not 
be cut, but has to be pulled up by the roots. Then the straw must 
be retted, which means soaking in water or spreading to the action 
of dew and rain to dissolve the gums that bind the fibers together. 
After the retted flax is dried the next process is breaking, whereby 
the woody core of the flax stem is broken or crushed into small 
pieces but without injury to the fiber. Then comes the final 
process of scutching, which means a smart beating of the straw to 
shake out the pieces of core, or shives, thus leaving the fibers 
free. 

While linen was originally one of the staple fabrics of America 
and was used for nearly 200 years by the colonists for homespun 
linen and linsey-woolsey, every process was performed by hand; 
when the cotton gin made mill-manufactured cottons plentiful and 
cheap, homespun linens were completely and cheerfully replaced. 
For the past 100 years fiber flax has been practically unknown in 
America, and our linen industry has been an insignificant 
thing. 

With this new machine a crew of six men produces more fiber 
than 85 men using hand breakers and scutchers were able to 
produce seven years ago. The cost of scutching has been reduced 
from six cents to one cent a pound. A higher proportion of line 
fiber is recovered, of a better grade and a finer reed, and the per¬ 
centage of less valuable spinning tow has been reduced from 
20 to 5 per cent. 

That is the transformation in the preparation of flax fiber. In 
pulling, threshing, retting, and scutching, the total cost has been 


436 ECONOMICS OF CLOTHING AND TEXTILES 


reduced to less than one-fourth of the former cost by hand. With 
this system a quality of fiber is produced that is equal to any in 
the world. More than half of the output is used in local spinning 
mills in Oregon, and the remainder is shipped to eastern mills and 
abroad. In 1932 shipments were made to Massachusetts, New 
Jersey, New York, Antwerp, and Barcelona. Even Ireland has 
been supplied from this plant, 350,000 pounds of spinning tow 
going to Belfast from Salem in 1927. 

This experiment in manufacturing linen by machinery was done 
by the State of Oregon with the assistance of convict labor. The 
convicts working in the flax industry are paid a small wage for their 
labor, running up to 75 cents a day. To provide work for the 
inmates, twice as many of them are employed in this industry as 
would be required under normal conditions. 

The methods now perfected in Oregon have reduced costs to less 
than one-fourth of the cost of hand labor, whether that labor be 
convict or free. And finally, a profit of 19 to 32 per cent on the 
sales during the past two years — 23 to 48 per cent on the costs — 
might be considerably reduced without ruining a private enterprise. 

In the entire United States at present there are only twelve or 
fourteen flax-spinning mills, producing linen yarns, twines, threads, 
fish lines and nets, and some coarse toweling. Most of them are 
located in the eastern States and use imported fiber. Not one of 
them is equipped with machinery for spinning yarns fine enough 
for handkerchiefs or the better grades of dress linens. They have 
neither the machinery nor the expert spinners and weavers that 
have made the fine linen goods of Ireland, Belgium, and France 
famous throughout the world. 

Novel Fabrics. The Russians manufacture a fabric from the 
fiber of a filamentous stone from the Siberian mines, which is said. 
to be of so durable a nature that it is practically indestructible. 
The material is soft to the touch and pliable in the extreme, and 
when soiled has only to be placed in a fire to be made absolutely 
clean. 

Iron cloth is largely used today by tailors everywhere, for the 
purpose of making the collars of coats set properly. This cloth is 
manufactured from steel wool and has the appearance of having 
been woven from horse-hair. 


RESEARCH AND INVESTIGATION 


437 


Wool not the product of sheep is being utilized abroad for the 
making of men’s clothing. This is known as “limestone wool,” 
and is made in an electric furnace. Powdered limestone, mixed 
with certain chemicals, is thrown into the furnace, and after passing 
through a furious air blast, it is tossed out as fluffy white wool. 
When it comes from the furnace, the wool is dyed and woven into 
lengths like cloth. A pair of trousers or a coat made of this 
material can not, it is claimed, be burned or damaged by grease, 
and the cloth is as flexible as that made of sheep’s wool. 

An English manufacturer has succeeded in making a fabric from 
old ropes. He obtained a quantity of old cordage, unraveled it, 
and wove it by a secret process into a kind of rough cloth. The 
resultant material he dyed a dark brown. A suit made from this 
queer stuff was worn by the manufacturer himself, and it is said 
that he has a large trade in this product in the British colonies. 

A novelty in dress material for women is spun-grass cloth, which 
may, it is said, be had in white, green, lilac, pink, and yellow shades. 
The inventor of this was an Austrian, and his invention is said to 
have resulted in the production of a material as bright and as 
flexible as silk. 

Paper clothes were worn by the Japanese troops, who found them 
very serviceable and much warmer than those of cloth. Paper 
dressing gowns, bath robes, and similar articles of attire are now 
being turned out by the carload in European countries. The paper 
of which they are made is of the “blotting” variety, and after being 
treated by a new process is dyed in various colors or printed with a 
pretty floral design. 

Even gloves are made of paper, the principal claim to advantage 
being that they are susceptible of being cleaned many times. 

Synthetic Fibers. 1 Since 1884 the fact has been known to the 
scientific world that a substance of the same chemical composition 
as silk could be made by artificial means; but the problem of render¬ 
ing the process industrially practical required many years of 
research. The product was first called artificial silk and is said to 
be the result of forty years of careful experimenting by Count 
Hilaire de Chardonnet of France — the inventor of the original 
process. When Chardonnet first began his labors, he studied the 

1 E. Schwarz, in Journal of Commerce. 


438 ECONOMICS OF CLOTHING AND TEXTILES 


silkworm and its process of spinning, with the determination to 
reproduce it, so that the fabric might be created as nearly as 
possible from the original elements. He found that the leaf of the 
mulberry was a form of vegetable fiber that attracted the silkworm 
by its tenderness and flavor, and that by the natural process of its 
secretions, the worm mixed this fiber with a substance that com¬ 
pleted the formation of a gummy mass from which it spun its 
cocoon. Naturally the chief difficulty was to discover a chemical 
combination that corresponded to the bodily secretion of the 
caterpillar, and this Chardonnet did after numerous trials and 
failures. This done, the experimental machinery was devised and 
built. The wood originally used for the manufacture of artificial 
silk was mulberry. This was crushed by machinery and chemically 
treated and the “stock” or pulp was poured into cylinders. Heavy 
pressure was brought to bear upon it, by means of which it was 
forced out through minute holes in the form of tiny fibers of any 
desired length. 

These fibers were almost perfect reproductions of the thread of 
the silkworm. There was one serious disadvantage, however — the 
product was extremely inflammable. Later this fault was to a 
large degree overcome by immersing the artificial threads in a solu¬ 
tion of ammonia. About 1890 it was discovered that it was not 
necessary to use the wood of the mulberry tree, and that almost any 
variety of soft wood might serve. In 1893, large works for the 
manufacture of wood silk were established at Besangon, France, 
under patents granted to Chardonnet. 

The history of inventions and patents shows that as soon as one 
individual or corporation has secured a monopoly on a certain 
machine or process, immediately competitors start research to 
invent a similar machine or process involving different elements, 
so that the special products of the monopoly are soon made by 
competitors. This is shown in the invention of different types 
of textile machinery, as well as in the creation of different types 
of synthetic fibers. 

Rayon. There is hardly an industry which has had a develop¬ 
ment as tremendous and rapid as the rayon industry, especially 
in recent years. The quality of the product has been improved 
greatly, manufacturing methods perfected to a high degree, and 


RESEARCH AND INVESTIGATION 


439 


production costs reduced. This, together with the fact that the 
difficulties in dyeing and printing this new textile have been over¬ 
come to a large degree, has brought about a wide use of rayon in 
almost all branches of the textile industry. For rayon is not only 
used alone but also in combination with other textile fibers, — 
cotton and wool, — and also with the natural filament, silk. It 
is said that rayon, when used together with other fibers, either 
enhances the value of the resulting product or reduces the manu¬ 
facturing cost of the fabric. 

Four countries have contributed to the evolution of “ artificial 
silk,” as this raw material was formerly called. It is now called 
rayon or synthetic fiber or fabric. The native land of rayon is 
France. Three other countries contributed to this remarkable 
development: Fremery and Urban, of Germany, worked out the 
cuprammonium process, and Bevan of England has developed the 
viscose process, which is now the process used most extensively. 
America and Germany share the honor of the invention of the 
acetate process. An American took out the first basic patent for 
this process, while a German, at about the same time, made the 
first practical batches of acetyl-cellulose. 

It may be well to explain here briefly the four different processes 
according to which rayon is now made. 

Nitrocellulose. The first process applied commercially to the manu¬ 
facture of rayon was worked out by Chardonnet of France, who took out 
the first patent in 1884, although for several years before chemical yarns 
were being made by squeezing a mixture of wood and cotton pulp through 
fine holes. The nitrocellulose process, as used by Chardonnet, generally 
takes as a base cotton linters. By means of nitric acid the cellulose is 
transformed into nitrocellulose (known as gunpowder) dissolved in a mix¬ 
ture of alcohol and ether, and the solution forms the spinning fila¬ 
ment. 

Cuprammonium. This process employs an ammoniacal copper oxide 
solution (Schweitzer’s reagent) to dissolve the cellulose — either wood 
pulp or cotton linters. Six per cent of the world’s production of rayon 
in 1927 was made by this process. 

Viscose. For this process wood pulp is mostly employed. The cellulose 
is transformed into alkali solution by means of caustic soda, then with 
carbon bisulphide into cellulose xanthate. This is brought into solution 
with weak caustic soda. The viscose process is the one now most widely 


440 ECONOMICS OF CLOTHING AND TEXTILES 


used. In 1927, 84 per cent of the world’s rayon production and 82 per 
cent of the production in the United States was made by this process. 

Cellulose Acetate. While the final product of the three previous proc¬ 
esses is regenerated cellulose, the product of this process is an ester (salt) 
of cellulose : The cellulose — cotton linters are used mostly — is mixed 
with acetic acid, acetic anhydride, and a catalytic. The resulting 
cellulose acetate is then dissolved in acetone (a solvent), wherefrom the 
filament is spun. Seven per cent of the world production and 3.8 per 
cent of the United States production. of rayon in 1927 was acetate 
cellulose. 

The ratio of the 1928 world production was : viscose, 84 per cent; 
nitrocellulose, 8.5 per cent; acetate, 5 per cent; cuprammonium, 
2.5 per cent. 

After the Chardonnet patent, many other patents were obtained 
for the manufacture of artificial silk, or rayon. At present there 
are several distinct forms of rayon on the market, such as (a) viscose 
rayon, (b) acetate rayon, (c) nitrocellulose rayon, (d) copper 
ammonium rayon, and (e) spun rayon. Some of these forms have 
been developed very highly and have been given special trade 
names — celanese, bemberg, etc. The methods of manufacturing 
are so guarded by patents that the corporations producing the 
fabrics have practically a monopoly on them. 

Increase of Rayon Production. The tremendous growth of the 
rayon industry is shown most vividly by a comparison of the fol¬ 
lowing figures: 

Production, 1896. 1,200,000 pounds 

Production, 1928 .over 350,000,000 pounds 

Production, 1933 .207,600,000 pounds 

This drop in production was due to the depression. 

Until 1921 the rayon industry in the United States gained pro¬ 
duction slowly, — about 1,000,000 pounds a year, — but after 1921 
the output rose from 15,000,000 to 52,000,000 pounds in 1925. 
During the three-year period of 1926 to 1928 the output increased 
by 46,000,000 pounds, and for 1929 the production was estimated 
to be between 25,000,000 and 30,000,000 pounds higher than in 
the preceding year. 

Leading American Manufacturers of Rayon. The Viscose Co. is the 
largest manufacturer of viscose in the United States and throughout the 





RESEARCH AND INVESTIGATION 


441 


world. The product is sold in twenty different sizes and types of yarn — 
bright, subdued luster, multifilament yarn — and is used for practically 
all purposes. The yarn is sold as Crown Brand rayon with the following 
special names: Dulesco, Dulenza, Durafil. The acetate yarn is sold as 
Seraceta. 

The second largest rayon-producing concern in the United States is the 
du Pont Rayon Co., controlled by E. I. du Pont de Nemours & Co. Inc. 
The new product of this firm, Chardonize, a subdued luster yarn, has 
met with great success with the knitters of women’s underwear, and almost 
as much with the men’s wear trade. Novel fabrics have been made by 
combining the standard Tubize yarn and Chardonize. Although both 
yarns are nitrocellulose rayons, a cross-dyed effect is Obtained which was 
hitherto only possible in combining a rayon yarn with acetate yarn. 
The new brand is also very successfully used for ladies hosiery and men’s 
hose, on account of its low luster. 

There was until recently only one producer of acetate yarn, the Celanese 
Corporation. The company shows great activity in developing dyeings 
and prints, especially “discharge” prints of unusual effects. A number 
of other manufacturers have announced their intention of taking up the 
production of this yarn, which becomes more and more important. 

The American Bemberg Corporation, a subsidiary of the I. P. Bemberg 
A. G. in Barmen, with a total capital of $8,000,000 (company’s financial 
report, December 20, 1928), is at present the only important domestic 
producer of cuprammonium yarn. The company produces a great variety 
of yarns — 300, 240, 180, 150, 120, 100, 80, 60 denier — featuring both 
natural and subdued luster. The latest development is represented by 
the yarns: Superfine A quality untwisted on spools, ultramultifilament, 
natural subdued luster: 

15 denier.25 filament 

25 denier. 25 filament 

30 denier.25 filament 

40 denier.30 filament 

52 denier.30 filament 

As an illustration of the fineness of such yarns it may be interesting 
to note that the diameter of a single filament measures 0.0004 of an inch, 
in comparison with the finest filament known, a spider filament, which is 
0.00023 of an inch. The weight of a filament of natural silk (produced 
by the larva of the silk worm, bombyx mori) averages 1-3 denier. A 
newspaper sheet is about nine times as thick as one filament of a 15 denier 
yarn. Some of the trade names under which Bemberg fabrics are being 
sold, according to the leaflet of the Bemberg Corporation, are: Svelda; 







442 ECONOMICS OF CLOTHING AND TEXTILES 


Scharg moire (Bemberg and silk); Svelda chiffon crepe, ninon, pique, 
radium, tripole and voile; and Zeppelin chiffon; also Burson fashioned 
hose; Berkshire full-fashioned hose, and Gold Seal, Phoenix, Better Wear, 
Hole-proof, Schmidt, Defiame, Lady Burd, Strutwear; for underwear, 
circular-knit Augusta, tricot-knit Silkanese (Bemberg and silk). 

Spun Rayon. Rayon is not a “fiber ” like cotton or wool, but a 
“filament,” thousands of yards in length, like silk. Rayon yarns, 
therefore, were, and still are, generally made by twisting a number 
of filaments, in the same way as thrown silk. Efforts, however, had 
been made, originally in Germany on account of the shortage of 
textile fibers, to utilize the waste in rayon manufacture for spinning 
into yarn. Today spun rayon yarns are being used satisfactorily 
for many types of fabrics, either straight rayon fabrics or rayon in 
combination with wool or other fibers, giving unusual color effects. 
In the United States the Fitchburg Yarn Co. was the pioneer for 
spun rayon, working with the cotton spinning system. The product 
is sold under the name of Sase. Today this concern is the largest 
producer of spun rayon in the United States. It uses Vistra, im¬ 
ported from Germany and manufactured by the I. G. Farbenindustrie. 

Today spun rayon yarns are produced in five ways, namely : 

1. Bradford system of worsted spinning. 

2. French system of worsted spinning. 

3. Spun silk (or schappe) system of spinning. 

4. Woolen system. 

5. Cotton system. 

At present spun rayon is no longer made from waste, but from 
cut rayon, which is absolutely uniform. The variety of uses for 
spun rayon is great, notably for dress and lining materials, damasks, 
jacquard fabrics, plushes, velvets, towels, carpets, etc. 

New textile products are continually being put on the market 
containing rayon waste and spun rayon yarns, both on the worsted 
and the cotton and silk spinning systems. Crepe dress cloths from 
spun rayon yarns are popular, and the new tweed coatings and suit¬ 
ings provide a use for rayon waste and staple fiber. 

There has been a great deal of experimentation in the use of all 
kinds of spun rayon yarns, which leads one to believe that if one- 
tenth of them are successful, a steady demand will be created for 
waste for woolen and worsted spinning and also for staple fiber 


RESEARCH AND INVESTIGATION 


443 


to be spun on the cotton system. Attractive dress goods within 
reach of all purses are now on the market. Various household 
textiles are also offered, all containing spun rayon yarns. 

The field is greater than it was even a year ago and is expanding 
all the time. The fact that the depression has not entirely killed 
the spun rayon yarn industry indicates that the foundation at 
least is basically sound. The care with which the big rayon 
companies grade and handle their waste, in spite of the low 
price at which it is selling, lends confidence to the feeling 
that eventually this valuable textile fiber will prove its real 
value and sell at a price that will justify its continued main¬ 
tenance of quality. 

Research in Silk Production . 1 It is not possible to produce silk 
with profit in this country in competition with the foreign article. 
The great difficulty hitherto, and probably a continuing one, is our 
inability to compete with the cheaper labor of countries where silk 
is an important commercial product. Even in some of these coun¬ 
tries a subsidy has proved to be necessary. The production of 
silk entails a good deal of hand labor in the feeding and handling 
of the larvae and the conversion of the cocoons into the raw silk 
of commerce. Reeling silk on a commercial scale involves, also, 
expensive apparatus and technically trained workers. 

The chief hazards of the industry are certain devastating diseases 
of the silkworm which can be guarded against only by scrupulous 
attention to sanitary measures covering the entire life period of the 
insect from egg to adult. 

Beginning with Colonial days, various efforts to develop a silk 
industry in the United States have been made, all of which resulted 
in failure in the end. As already indicated, the only important 
obstacle has been the labor factor. The white mulberry, or some of 
its varieties, the leaf of which is the desirable food for silkworms, 
can be grown successfully almost anywhere in the United States, 
and there has been wide demonstration of the successful rearing of 
silkworms. Since it is impossible to grow silk profitably in the 
United States, the silk manufacturers are interested in the develop¬ 
ment of silk in other countries in order that they may secure the 
highest grade of the filament. 

1 United States Testing Co., Inc. 


444 ECONOMICS OF CLOTHING AND TEXTILES 


Sericulture. The application of biological principles to raising 
silk has done much to improve the quality. The total production 
of silkworms varies greatly. The Agriculture and Forestry 
Department announces that on April 30, 1932, Japan’s hatching of 
spring crop silk eggs was estimated at 73,441,200 grams. Com¬ 
pared with actual hatching for the 1931 spring harvest of 79,534,991 
grams, the estimated figure represents a decline of 7.7 per cent. 
White silk eggs accounted for 54 per cent of the above hatching, 
and the balance was of the yellow variety. 

As the silkworms thus hatched will undergo a thorough weeding- 
out process, the production of cocoons will not always tally with the 
quantity of silk eggs brushed, but this estimate is noteworthy in 
view of a previous estimate made public by the Japan Raw Silk 
Association showing a reduction of 12.3 per cent. It is the view of 
the Agriculture authorities that the 7.7 per cent reduction was due 
to the silk farmer’s conservative production policy of 1932. 

At the Agriculture Department it is remarked that the weather 
was in general unseasonal in the spring of 1932. This, coupled 
with the scantily manured condition of the fields during the past 
two years, is expected to reduce materially the supply of feed leaves, 
and a 10 to 20 per cent decline in cocoon production is expected in 
many prefectures. In extreme cases even a 30 per cent reduction 
is believed possible. 

Aided by the government, the farmers in many districts have 
begun, on their own initiative, to replace old mulberry trees with 
saplings. The acreage of mulberry trees in full bearing stage has 
thereby been reduced more than 30,000 chobu (1 chobu equals 
2.45 acres). The total mulberry acreage of Japan proper on June 
30,1930, was 716,000 chobu. One official stated that he is prepared 
to see a reduction in the mulberry supply to 85 per cent of that in 
the spring of 1931. 

It is, therefore, very probable that the weeding-out process 
for silkworms in 1932 was most drastic, and even a wholesale 
abandonment of worms may have been resorted to by the 
farmers. Moreover, cocoons spun by silkworms that were fed 
on mulberry leaves of undermanured fields are usually of a poor 
quality, which can not fail to affect adversely the production 
volume of raw silk. 


RESEARCH AND INVESTIGATION 


445 


Silkworms will, when mulberry is not available, eat substitutes 
such as lettuce, but from the digestion and assimilation of these 
substitutes, they can not produce the fluids, fibroin and sericin, of 
which the cocoon filament is composed, and therefore can not 
secrete the silk filament. The sericin is the gum which is dissolved 
and removed in the boil-off operation; the fibroin is the portion 
which remains and is the useful portion of the raw silk thread. 

The digestive, assimilative, and secretive functions of the silkworm 
are so delicate and sensitive that differences in the chemical contents 
of the soil, types of mulberry used, the climate where it is grown, the 
season of the year, etc., directly affect the physical characteristics 
and chemical reactions of the fiber secreted. There are also many 
species and varieties of the silkworm, and extensive cross-breeding 
has taken place in Japan to breed-up the worms to larger and more 
vigorous cocoons yielding a larger quantity of useful fiber. 

Mulberry can be grown and cocoons can be produced in nearly 
all portions of Japan, from a latitude corresponding to Boston or 
Montreal to well south of New Orleans, and altitudes ranging from 
sea level to some of the high mountain plateaus. 

Mulberry grown under such diversity of climate and soil will 
vary extensively in its nature. In any given locality the mulberry 
leaves grown in the warm, moist days of spring will differ decidedly 
from those grown in the long hot days of summer or the shorter, 
less favorable days of autumn. From 26 to 30 days are required 
from the hatching of the eggs for the cocoons to mature. There¬ 
fore, in nearly all parts of Japan three crops of cocoons can be 
produced each year. Approximately 50 per cent are grown in the 
spring, 20 per cent in the summer, and 30 per cent in the autumn. 
The quality of the spring crop is superior to the summer and 
autumn crops and the prices correspondingly higher. 

When the mature worm is ready to spin, it begins secreting a 
rather rough, uneven, and poor quality filament, which it uses to 
form a web to suspend the cocoon from the surrounding twigs, 
straw, split bamboo, or other rough material upon which the worms 
are placed for cocoon spinning. This first fiber is called “ blaze,” 
and it is stripped from the cocoon and discarded before reeling. 

As the secretion of the filament proceeds, it becomes more regular, 
gradually increasing in size from about 2.5 deniers to approximately 


446 ECONOMICS OF CLOTHING AND TEXTILES 


4 deniers and then very gradually decreases until the worm is 
completely exhausted and ceases spinning. The last portion of 
thread is, like the first portion, irregular, very fine, and poor in 
quality. It is discarded as waste, and in good filature practice is 
not reeled beyond where it is about 1.75 denier in size. 

There are from 1400 to 2000 feet of useful fiber on the average 
Japanese cocoon. From these cocoon filaments, which begin with 
a small diameter, increase quite rapidly to a maximum, run uni¬ 
formly for a while, and then slowly taper off, the Japanese raw silk 
reeling girl is expected to reel an even raw silk thread. A yf denier 
raw silk should theoretically average 14 denier and by the raw 
silk rules of the Silk Association of America should show by actual 
test an average between 13.5 denier and 14.5 denier. It requires 
from four to six cocoon filaments, depending upon the state of the 
cocoons, to produce a denier thread, and the reeling girl must 
keep them adjusted in proper proportion of fresh cocoons, partially 
exhausted, and nearly exhausted cocoons. An exhausted cocoon is 
dropped out when its size is about 1^ deniers and a fresh cocoon 
added at about 3 deniers. 

There is, therefore, an unavoidable change in the raw silk thread 
with the addition of fresh cocoons of about 1 to 2 deniers in the 
normal process of reeling. 

With this in mind, the raw silk classification committee of the Silk 
Association of America has taken the position that a raw silk thread 
within 2 deniers of the average size is normal. It also happens that in 
viewing raw silk panels on the seriplane boards, a sudden change of 2 
deniers is just about noticeable as a very faint stripe. But if the reeling 
girl is able to change the cocoons regularly, if no cocoon filaments break 
before near exhaustion, and if the speed of reeling is not too great, she can 
make the ideal thread, which is rated on the seriplane panel as 100 per cent. 

It is, of course, not possible to maintain this ideal condition continu¬ 
ously. As the changing of cocoon filaments to keep the thread running 
becomes less regular, and the adjustment of the partially exhausted cocoons 
less accurate, more and more stripes of 4, 6, and 8 deniers occur, and the 
grade of the raw silk becomes lower. 

Just as the textile industry of the United States varies from a small 
plant of a few machines buying thrown silk a few cones at a time, up to 
a great mill buying 200 and 300 bales of raw silk at once, the filature 
industry in Japan consists of small production by the neighborhood 


RESEARCH AND INVESTIGATION 447 

farmers up to the great filature organizations operating many large mills 
and buying their cocoons in every portion of Japan. 

Many of these small filatures, carefully supervised, and operated with 
the women of the immediate neighborhood, reel very good raw silk, 
but in the purchase of their cocoon supply, the sale of their product, and 
the volume of their capital they have about the same relation to the great 
filature organizations as the small corner grocer in this country has to the 
great Atlantic and Pacific Tea Company. 

Years ago, when the American silk industry was small and the manu¬ 
facturing units were small, the Japanese began to replace the hand¬ 
reeling of the farmers’ families by the power-driven or so-called steam 
filature. 

The filature purchased its supply of cocoons in its own neighborhood, 
and labeled its product with its own trade mark or “chop,” and the 
American consumer was satisfied to purchase the little shipment of a few 
packages of homogeneous, fairly uniform, and identifiable raw silk under 
the maker’s chop and fixed responsibility. As the American manufactur¬ 
ing units increased, and the volume of specific numbers of construction 
requiring uniformity in raw material expanded, the manufacturer began 
to demand his raw silk in larger units or runs. From five-bale lots his 
orders increased to 10, 20, 30, 50, 100 bales, etc., until at present it is not 
uncommon for some knit goods organizations to purchase 200 or 300 
bales of one quality at one time. 

The average production of the Japanese filatures is about li bales of 
raw silk per basin per year, with many small filatures probably producing 
not more than one bale per basin per year. The medium and small-sized 
filatures do not have sufficient capital to enable them to hold the silk from 
the market until they have enough to make even a 10-bale lot. Three 
hundred bales would exceed the entire year’s production of many filatures. 
It therefore becomes necessary to sell small lots at frequent intervals. 

In Yokohama, these lots were formerly carefully inspected, sorted, 
graded, and assembled into marketable 10-bale runs. The exporters 
maintained large inspection laboratories with skilled inspectors, who knew 
the filature, the types of cocoons it purchased, and its general reputation 
for workmanship. In addition, the inspectors made a careful visual 
inspection for uniformity of color, manner of packing, and other character¬ 
istics that influence quality. This visual inspection was followed by 
sizing, winding, and other tests to determine quality. The grade of the 
small lot was established and it was assembled with other small lots into 
runs under a single chop, to supply the demands of the American con¬ 
sumer for 20, 40, 60, or 100 bales of the same grade and chop. 


448 ECONOMICS OF CLOTHING AND TEXTILES 


Let us consider a big filature of 1000 basins. It will produce approxi¬ 
mately 1500 bales in 10 months of operation, or an average of 150 bales 
per month. The exporter in Japan and the importer in America assumed 
responsibility for this assembly, and in accordance with the demands of 
the American consumer, stood responsible for its grading of the delivery. 
This assembling of bales and lots had its origin in an American demand. 

As the industry expanded, the system of assembling bales and lots 
naturally opened the door to non-uniform lots and unsatisfactory practices. 
When the filatures began transporting cocoons from one district to another, 
the inspector no longer could be assured of their origin, and the names 
of districts upon chop tickets became meaningless. 

The Shinshu raw silk, the product of the great Shinshu district in 
Nagano prefecture, where the cocoons were grown on the side hills and 
around the lake shores by the farmers, was reeled by small filatures into 
what was considered “soft natured” raw silk. Today there are between 
50,000 and 60,000 basins in the great filatures which line the shores of 
lake Suwa alone. Their cocoon supply must come from many different 
districts, and besides the large cocoon warehouses at each plant there is 
a cooperative warehouse company operating thirty-six large warehouses 
for the storage of cocoons. 

From the description given earlier of the effect of climate, season, 
soil, type of silkworm, etc., upon the cocoon filament, you probably 
begin to suspect a possible cause for the so-called “two-tone 
effect” in knit goods. Stripes have become the dominant grading 
defect in silk hosiery. They have two general causes: (1) either 
a marked change in size of the tram 1 or (2) difference in the dye- 
absorptive capacity of the raw filament. 

There seems to be a general impression that the two-tone effect 
is of recent origin, and that it is rapidly increasing. It may be 
increasing, but it has probably existed for a number of years, 
although more recently recognized as difference in shade, instead 
of stripe, caused by difference in size. 

For many years the Japanese filatures have reeled for average 
size. The reeling girls are taught the proper number of cocoons to 
use to make the average size required, and in the re-reeling room 
sizing skeins of either 225 or 450 meters are taken at random from 
each reeling girl's skein. If it is found that she has reeled too coarse 
or too fine a skein, she is penalized. Naturally the girls endeavor 

1 See author’s trade edition of Textiles for explanations of terms. 


RESEARCH AND INVESTIGATION 


449 


to average up the thread. If by any chance two or more cocoon 
ends go down at once before she can throw in fresh ones, the silk 
runs a fine end for some distance, 10 meters, 20 meters, or 100 
meters. She then throws in three or four cocoon ends, either 
together or in quick succession, and a coarse end of perhaps 6, 8, 
or 10 deniers results. 

When the hosiery industry was using five, six, eight threads and 
more, the variations were not very noticeable. They generally 
“evened-up,” but if they did not, the buying public were not so 
critical. The flesh-pink color of the human leg, with its perfection 
or imperfections, did not show through the fabric, and the wearer 
did not care very much. A six-thread tram was equivalent to 84 
deniers, and a sudden change of six deniers, about two cocoon fila¬ 
ments, was about seven per cent. But with a three-thread fabric, it 
amounts to about 15 per cent. With the color of the skin showing 
through, the 15 per cent sudden change makes a definite stripe. 
It is probable that, as the Japanese raw silk producers contend, the 
general evenness of Japanese raw silk has improved in the last 25 
years, and today there is a larger proportion of even silk on the 
market than in earlier days. Our standards have changed and our 
requirements have become very much more exacting. 

As our tram decreased to a five-thread, four-thread, three-thread, 
and we now strive for a two-thread, the 450-meter sizing test no 
longer reflects the evenness of raw silk as it works out in manu¬ 
facture. The sizings were reduced to 225 meters, then to 1121- 
meters, and now some technicians are advocating nine-meter tests 
to determine the short, fine, and coarse ends. The seriplane is 
a device developed and now in use to estimate the unevenness 
within the length of a sizing skein. It is probable that its introduc¬ 
tion may have somewhat modified the reeling girls’ procedure. 

Testers formerly drew 10 skeins to represent the bale, and sampled 
two bales to represent a five-bale lot. The official sample today 
consists of 40 skeins drawn at random, four from each bale of a 
10-bale lot. The next report of the raw silk classification com¬ 
mittee of the Silk Association will probably recommend 50 skeins 
from 10 bales, or five skeins from each bale. 

In the Japanese filatures every skein can be inspected. In Yo¬ 
kohama and Kobe every book can be inspected. In America, the 


450 ECONOMICS OF CLOTHING AND TEXTILES 


inspection and the testing must, by the very nature of the market 
conditions, depend upon a representative sample of reasonable 
size. Therefore, the fundamental assumption of the entire system 
is sufficient uniformity within the market unit of the merchandise, 
so that a representative sample can be drawn and a safe judgment 
formed from the inspection and test results upon this sample. 

In recent years there has been an increasing number of indica¬ 
tions that 10-bale lots of raw silk are arriving in this market so lack¬ 
ing in uniformity of color, nature, size, evenness, and other quality 
characteristics as to make it impossible to take the official sample, 
drawn at random from each bale of a lot, to inspect it and test and 
obtain results which may be depended upon to represent the lot. 

The criteria of dependability are of two kinds: (1) the labora¬ 
tory's indicator of reliability is the accuracy with which the lot 
can be resampled and retested and obtain duplicate results with a 
reasonable limit of tolerance; (2) the mill's indicator of reliability 
is the extent to which the quality of the finished product and the 
cost of the manufacturer’s operations confirm the results of the 
inspection and test. If the lot is not uniform, the laboratory 
results upon the sample may reflect the lack of uniformity and 
damage is prevented; but if it does not, the mill results usually 
appear too late to be of value in preventing damage. 

In so far as the manufacturer bases his judgment of the raw 
silk he prepares to use in his mill upon a sample that is less in 
quantity or distribution than the 40-skein standard sample, drawn 
at random from each and every bale, he increases the hazard of 
depending upon a non-representative sample. One book to repre¬ 
sent a 10-bale lot, that is, 10 skeins drawn from two bales of a five- 
or 10-bale lot, illustrates sampling which is too limited in distribu¬ 
tion and number to give a representative sample of any except 
a very uniform 10-bale lot of raw silk. 

The first and most important thing to do is to take steps to 
impress upon the primary market that a bale or group of bales con¬ 
stituting a lot shall be uniform in nature, color, size, type, district, 
and season of cocoons, even if it is necessary to group bales in less 
than 10-bale lots. 

The new conditions introduced in the Yokohama and Kobe 
markets, January 6, 1932, are both favorable and unfavorable to 


RESEARCH AND INVESTIGATION 


451 


securing desirable results. Since that date all raw silk intended for 
export must be bought and sold on the certificate of grade issued by 
either the Yokohama or Kobe Imperial Conditioning House, and the 
certification of grade by either is final. No silk is allowed to be 
shipped unless it has been inspected, tested, certificated, and sealed 
by the testing house, and it must leave the port with the seal unbroken. 

The export companies formerly maintained large, well-equipped 
inspection departments, responsible for the proper grading and 
packing of the cargo. They had a chance to examine every 
book, and even skeins if it seemed necessary, and to assemble the 
books into export bales. Since January, 1932, they do not have 
that privilege, but must content themselves with the 50-skein 
sample furnished them by the testing house. They are complaining 
bitterly of this curtailment in their opportunity to inspect and 
grade material for which they must be responsible to their cus¬ 
tomers in the secondary markets, like New York. 

The quality of finished silk goods is dependent upon a number 
of factors in the various stages of manufacture and finishing, but 
by far the most important element is the determination of the 
quality of the raw silk used. 

In the case of silk knitting, the knitter usually secures his tram¬ 
filling silk yarn either by purchasing raw silk, throwing it in his own 
plant or having it thrown on commission, or by purchasing tram 
from a throwster, either with or without a specification of the 
grade of raw silk used to produce the tram. 

Finished goods are graded by the absence of defects. It is 
a negative type of classification dependent upon the number of 
defects present. 

One of the great abuses in silk finishing is the weighting of silk 
by the addition of chemicals such as tin chloride, sugar of lead, etc. 
The purpose is to increase the weight of silk fabrics, thus suggesting 
a better quality. 

Weighting of Silk. Experiments show that beyond a certain 
point each ounce of tin weighting added to the thread silk — and 
especially if aging has been permitted — increases the possibilities 
of damage in handling and therefore in the cleaning process. 

Since 1926 the percentage of tin weighting applied to worm silk 
has had two effects — namely, the decrease in the tensile strength 


452 ECONOMICS OF CLOTHING AND TEXTILES 


and wearing qualities of the fabric, especially after exposure to sun¬ 
light, moisture, and under normal conditions of wear; and second, 
the steady and proportionate reduction in the price of the garment 
to the consumer. It is through excessive tin weighting that the 
American woman has been enabled to buy silk dresses 
at $4.98. 

In general, special weakening of the fiber begins when the tin 
weighting passes 25 per cent — that is, one pound of tin to three 
pounds of silk. For economic reasons manufacturers and finishers 
of the fabric, as well as merchandisers of the garments, can hardly 
be expected under present conditions to hold the weighting to that 
figure. They are therefore prepared to accept a maximum of 50 
per cent weighting on fabrics able to carry it — that is, one pound of 
tin to one pound of boiled-off silk. 

But in times of sharp competition this proportion has been 
greatly exceeded by certain manufacturers and demanded by cer¬ 
tain distributors. This has resulted in inordinate and excessive 
claims for damages falling on the dry cleaners. The total volume 
of business done by the dry-cleaning industry in the United States 
and Canada is slightly in excess of $700,000,000 per annum. The 
total amount of claims paid per year is approximately $10,000,000. 
The cause for half of these claims may be traced with reasonable 
accuracy to the excessive and improper weighting of silk. It is 
an unfair burden placed upon an industry whose charges have 
steadily decreased and whose service to the American public has 
steadily improved. 

The silk industry has accepted the trade practice rules adopted 
at its conference held recently in New York. Rule 1 contains the 
following definition of weighted, pure dye, and mixed goods. 

Weighted Goods. Goods containing in the finished state ( a ) silk 
or silk and other fiber or fibers, and (b) more than 10 per cent of 
any substance other than silk or such fiber or fibers except black — 
which shall not exceed 15 per cent — shall not be designated by a 
term containing reference to silk or such other fiber or fibers unless 
there be added to such designation the word weighted or some 
other qualification which shall reasonably indicate that such goods 
contain an addition of metallic salts or other substance above 
mentioned. 


RESEARCH AND INVESTIGATION 


453 


Pure Bye Goods. Goods containing silk, or silk and other 
fiber or fibers, shall not be designated pure dye if they contain 
in the finished state more than 10 per cent of any substance other 
than silk or such other fiber or fibers except black, which shall not 
exceed 15 per cent. 

Mixed Goods. Goods containing silk and other fiber or fibers 
shall not be designated by a term containing reference to silk 
unless there be added to such designation some qualification which 
shall reasonably indicate that such goods contain fiber other than silk. 

Substitute Materials. Research has supplied society with many 
artificial substitutes for fabrics and raw materials. The laboratory 
has made available as everyday possessions many beautiful pieces 
of rayon clothing and artificial leather and pearls. Millions of 
men and women of average means, position, and intellect live 
better, know more, and are richer in worth-while possessions than 
the dukes and duchesses of 300 years ago. 

Need of Rubber Research. A wealth of raw materials at low 
prices has spurred manufacturing industries to continue their 
untiring quest for new products. But this abundance of raw sup¬ 
plies, available in some instances at prices representing only a 
fraction of their former worth, has unfortunately caused some 
industries to fail in expanding utilization of their products. 

For example, the rubber manufacturers have ceased to make 
progress in developing new uses for a commodity for which there 
is admittedly no substitute. With crude rubber in plentiful supply 
at three cents a pound, it seems as if advances should have been 
made in its utilization outside the field of tire manufacture — for 
such purposes as road surfacing, building insulation, airplane 
manufacture, and as a plastic material for the manufacture of 
hundreds of articles of commerce. 

Development of Color Charts. In order to reduce the number of 
shades of a color used in wearing apparel each season, a committee 
of manufacturers has been formed to decide on certain shades for 
the season. The color correlation chart when adopted is issued to 
members of the Textile Color Card Association. 

In this chart, which will serve as a color guide in coordinating 
apparel and accessories, the fashionable shades for town, sports, 
and evening costumes are listed according to their cost, and for 


454 ECONOMICS OF CLOTHING AND TEXTILES 


each group are given the correct colors for shoes, bags, hosiery, and 
gloves. 

The fashion highlights in color harmonies and contrasts, includ¬ 
ing bi-color and tri-color effects, are indicated in another division 
of the chart, which is to be used in conjunction with the spring 
season cards for silks, woolens, shoes, and hosiery. 

The chart will not only serve as a merchandising reference for 
retailers to indicate the outstanding shades for accessories, but it 
will also provide a guide for manufacturers in keying their produc¬ 
tion to the basic costume colors for the coming seasons. 

To show how waste has been reduced to a minimum by this 
development, let us consider that a generation ago there were 
twenty shades of navy blue used in wearing apparel. Today that 
number has been reduced to two or three. 

Research in Wholesale Marketing. Plans for the establishment 
of a national institute for the study of wholesalers’ problems are 
being considered. The project, which would be financed through 
associate memberships held by wholesalers’ trade groups in the 
grocery, dry goods, electrical wares, and other fields, has support 
from a majority of wholesale associations, but has not progressed 
beyond the planning stage because of the depression. 

As outlined, the institute would aim to establish a better con¬ 
sumer understanding of the wholesalers’ functions, conduct research 
on cost and other problems common to all jobbers, and present the 
wholesalers’ side at all hearings on legislation affecting their 
interests. 

Merchandising Research. A movement for the establishment 
of an institute of merchandising research is soon to be realized. 
The institute will take the form of a central clearing house or 
laboratory to collate data obtained from actual merchandising 
experiments conducted by various member stores throughout the 
country. 

Practically every important industry today is maintaining 
research laboratories, which play a vital role in developing new and 
more scientific methods. Merchandising is one of the major ele¬ 
ments of the entire business picture and yet comparatively little 
has been done of a scientific nature in the study of its problems 
and in practice based on adequate and tested experimental data. 


RESEARCH AND INVESTIGATION 


455 


Merchandising today continues to be conducted largely on 
“ hunches,” gist of opinions, etc. The reason for this is the fact 
that nobody engaged actively in retailing has time to conduct 
scientific merchandising experimentation, to note the results in a 
proper way, and eliminate all extraneous factors which do not 
pertain to the particular question being analyzed. 

The proposed institute will deal, for example, with such funda¬ 
mental subjects as the prices at which merchandise sells best to con¬ 
sumers; what constitutes a proper assortment for any given 
community; and a subject of particular importance — how can the 
size of the average sales check be increased? 

It is planned to have the institute make experiments in various 
departments of stores ranging from small to large size, and to com¬ 
pile data on these and hundreds of other subjects. Reports will be 
issued to members of the association each year in bound form like 
a set of law books containing “cases” on merchandising subjects. 

The chief value of the data to be issued by the institute is that it 
will be empirical and based on actual experiments, properly and 
scientifically made, whereas the information now available on 
merchandising subjects represents little more than opinions by 
prominent retail executives. 

Opinions are valuable. But the science of merchandising can 
never make progress on opinions alone. After this institute has 
been functioning for a number of years, a large accumulation of 
data and experimental proceedings will have developed, which will 
be a reservoir of merchandising information that the merchant can 
profitably turn to for answers to perplexing problems. 

Labor Control. Various experiments have been conducted in 
the manufacturing process of various fibers to see if it is possible to 
reduce the cost of operation. For the purpose of labor control, 
in order to insure low operating costs, some form of piecework and 
bonus payment is recommended. If this method of payment is used, 
it must be kept under constant supervision of the most thorough 
sort. It must be accompanied by time studies of every operation 
whenever changes in equipment or operating conditions are encoun¬ 
tered. An application of carefully controlled research and develop¬ 
ment as to new products, new equipment, and improvement of 
old products and old equipment must be continuous and energetic. 


456 ECONOMICS OF CLOTHING AND TEXTILES 


General Textile Research. For the first time in its history, there 
has been made available to the textile industry of this country a 
foundation fund for scientific and economic research amounting to 
approximately $1,900,000. The Textile Foundation thus far has 
appropriated only the income of its fund for textile research, on 
about a 50-50 basis for scientific and economic or merchandising 
research. 

The United States Institute for Textile Research, Inc., was in 
process of organization by leading bodies of the industry while the 
bill for authorization of the Textile Foundation was pending in 
Congress, and following the passage of the bill, President Hoover 
appointed two preliminary directors of the United States Institute 
as directors of the Foundation — Franklin W. Hobbs, now its 
chairman, and Stewart W. Cramer, its present treasurer. There 
is no connection whatever between the Textile Foundation and the 
United States Institute for Textile Research except that both are 
organized for the promotion of scientific and economic research for 
the benefit of the textile industry. The Textile Foundation is a 
fund administered by a board of five directors, consisting of the 
Secretaries of Commerce and Agriculture and three others ap¬ 
pointed by the President. The United States Institute for Textile 
Research, Inc., is a cooperative, non-profit, membership corpora¬ 
tion operating under New York laws, which has as one of its objec¬ 
tives the raising of a foundation fund for textile research, to be 
administered by a self-perpetuating board of trustees. 

These two organizations provide the foundation upon which an 
adequate program for textile research may be built. The funds 
made available by the Textile Alliance are sufficient to initiate the 
work, and the United States Institute has provided a medium for 
safely meeting future needs. The 135 research-minded textile men 
who made up the United States Institute membership at the close 
of its first year are but a fraction of those needed to insure the 
permanent success of its work, but the fact that 90 per cent of them 
have renewed their membership indicates that the services rendered 
are valued and that the organization is headed in the right direction. 
The nature of the services already provided and those planned, 
together with the objectives and policies either tentatively or 
definitely determined, may be outlined as follows: 


RESEARCH AND INVESTIGATION 


457 


The United States Institute for Textile Research, Inc., provides 
a definite means for putting into action the thoughts and hopes 
of textile men who for many years had been convinced of the 
industry’s need of scientific research and of some cooperative body 
representative of the whole industry that might engage in research 
and its promotion. 

The industry had seen other old industries adventure in scientific 
research and profit thereby; it had seen new industries developed 
directly by research; it had witnessed a few such developments 
within, or closely allied to, the textile industry; it had seen a few 
textile concerns, most of them large in size and surplus funds, 
engage in scientific research to their personal profit. 

With such large available supplies of facilities and skilled per¬ 
sonnel in commercial, educational, and government laboratories, 
their utilization in cooperative research, fundamental or otherwise, 
would seem to be the quickest and cheapest path toward the 
desired goal. The ultimate ideal is a central group of laboratories 
directed and financed cooperatively by the industry . 1 

The founders of the United States Institute were well aware that 
the raising of a permanent foundation fund for fundamental 
research was likely to be a man-sized and long-time job. However, 
instead of delaying active research until ample funds and ideal 
facilities were available, plans were developed that made possible 
the immediate starting of a scientific textile research program. 

Briefly, these plans involve the utilization of existing research 
facilities; the building up of a research service library efficiently 
abstracted and indexed ; the publication of abstracts and a bibliog¬ 
raphy of current textile researches; and the coordination of textile 
research in progress. 

Testing Laboratories. In order to sell textiles and other wearing 
apparel commodities on merit, it is necessary to know the use of 
each piece of fabric and each garment and the conditions under 
which it is to be used as well as the qualities desired. This can be 
discovered only by establishing certain specifications for each 
article and then testing it according to the specifications made. 

To take the “ guess” out of buying and to establish merchandise 
standards one of the large retail dry goods stores R. H. Macy 

1 From Survey of Textile Research in the United States, 1931. 


458 ECONOMICS OF CLOTHING AND TEXTILES 


& Co., Inc. — in 1932 established a testing laboratory. Since its in¬ 
ception, the laboratory has fully justified itself as a highly valuable 
addition to modern retailing. Several thousand tests have been 
made, and the results have been decidedly worth while from .the 



Testing the Strength of Cotton Fibers 
In a store laboratory 


standpoint of the store, the manufacturers from whom it buys, and 
greater consumer satisfaction. 

For some years, the Macy organization followed with keen 
interest the work of the Federal Bureau of Standards. This body 
specifies standards for the purchases needed to satisfy the tre¬ 
mendous wants of the government. It buys by specification and 
conducts complete testing laboratories, with the result that huge 
savings are effected and better merchandise secured. 

The outcome was the establishment by Macy’s of a testing lab¬ 
oratory in a small way as an experiment. The immediate results 
were extremely gratifying. The store decided to enter into the 
task in a whole-hearted manner, and equipment was expanded and 








RESEARCH AND INVESTIGATION 459 

personnel increased, and a complete laboratory organized as the 
store’s Bureau of Standards and Testing Laboratory. 

This laboratory does four important things. It analyzes and 
compares competing offerings of manufacturers to obtain facts as 
to the content of the merchandise so as to determine the best value. 
The “guess” is taken out of buying and facts substituted. For 
example, if two manufacturers offer two blankets, each at the same 
price, the laboratory very quickly determines which is the better 
purchase. 

The laboratory also conducts tests for the purpose of ascertaining 
the performance of merchandise and its durability. These tests 
are of highly varied nature, including fading, washability, weakness 
and composition of material, weighting, dyes used, etc. When a 
fabric or merchandise stands up under the tests given, the results 
as far as consumer satisfaction are concerned are bound to be good. 

A few of the things the laboratory deals with are : the matter of 
slipping warp threads in various materials, especially silk .crepes. 
Numerous cases appear where the filling threads weaken, a condi¬ 
tion noticeable in woolen broadcloths for women’s coats and also 
in velveteens. Some velvets give rapidly. Weighting in silks 
is often too heavy. Under the heading of dyes come questions of 
fading, washing, dry cleaning, bleeding, crocking, irritation and 
rashes, and perspiration. The laboratory holds, for instance, that 
the material sold for a certain purpose should be fast to light, in 
so far as that use is concerned. A bathing suit, for example, 
should have a maximum resistance to light. 

The laboratory also tests materials returned by customers for 
adjustment. If, for example, a raincoat is returned by a customer 
as not shedding water, it tests it and finds out why, getting the details 
of the use to which it has been subj ected. Very often the laboratory 
is able to make definite suggestions to manufacturers as to how they 
can improve their products. It should be added that the laboratory 
does not in any case work against any manufacturer but instead 
offers its full cooperation for the benefit of all concerned. 

Another highly important use of the laboratory is in the checking 
of any statement to be used in an advertisement regarding mer¬ 
chandise. Unless the laboratory gives a substantiating report the 
statement is not printed. 


460 ECONOMICS OF CLOTHING AND TEXTILES 


Outstanding among the direct effects of the establishment of the 
laboratory is the influence it has had on the store’s buying staff. 
It has stimulated buyers to more careful buying, based on facts 
rather than guesswork. The buyers know that they have the fact¬ 
finding resources of the laboratory to guide them, and they make 
full use of its facilities. In fact, the laboratory has bred a more 
scientific merchandising attitude throughout the whole personnel 
of the store. 

The director of the Macy laboratory, discussing buying by tests 
and specifications, said : “I believe the time is not far distant when 
the individual purchaser is going to buy by specification. Those 
manufacturers who have not already done so will organize and 
support testing laboratories, possibly under the direct supervision 
of their trade associations. Standards will be evolved and products 
will be properly and accurately labeled. Retailers will buy accord¬ 
ing to specification and manufacturers will be insured against unfair 
competition. The consumer will benefit immensely, because he or 
she will obtain standard merchandise at a fair price.” 

QUESTIONS 

1. How do the principles of biology, chemistry, physics, psychology, 
sociology, art, and economics apply to the study of textiles ? 

2. How is Turkey red made? 

3. Why can we buy colored calico at such a low price today ? 

4. How is artificial indigo made ? 

5. What is the work of the Cotton Textile Institute ? 

6. Suggest methods by which the southern cotton-growers can 
improve their crops. 

7. Describe the flax industry. 

8. How did Count Hilaire de Chardonnet invent the processes for 
making synthetic fibers ? 

9. What four countries have contributed to the rayon industry? 

10. Describe the four processes by which rayon is made. 

11. What improvements has America made in the silk industry? 

12. What causes stripes to occur in silk hose? How can they be 
prevented ? 

13. Of what value has the United States Institute for Textile Research, 
Inc., been to the industry? To the public? 

14. What has the Macy testing bureau accomplished? 


CHAPTER XI 


PATENTS, TRADE-MARKS, AND DESIGNS 

Importance. With the invention of new machines, new products, 
and new designs in wearing apparel to meet the new wants of 
consumers, we find a parallel development in patents, trade-marks, 
and other protective devices. 

A patent is a government grant to an inventor securing for him 
the exclusive privilege for a number of years of making, using, 
or selling any new and useful machine, manufacturing process, or 
composition of matter — such as a special form of rayon manufac¬ 
ture or celanese. The United States government, in order to 
promote the progress of science and the useful arts, confers 
this privilege for seventeen years, without opportunity for 
renewal. 

History. The patent privilege of monopoly was first given in 
England about 1623. It had its foundation in the early days of 
history, when the Crown assumed that it owned everything and 
every one within its realm, and that it was the prerogative of the 
Crown to give to any individual the exclusive right to do or to make 
or to sell anything it chose. Naturally, as the people began to 
acquire more rights, there was much objection to the granting of 
such monopolies, especially when the Crown used these rights to 
abuse the public. By 1623 the Parliament of Great Britain passed 
what is known as the statute of monopolies, establishing strict 
limitations to the power of the throne with regard to monopoly 
grants. In effect, the statute stated that the Crown did not have 
and from that time on should not have the right to grant a monop¬ 
oly for anything except inventions and manufactures. However, 
this statute went somewhat farther than our own Constitution, by 
permitting the granting of monopolies not merely for new inven¬ 
tions but also for the introduction, importation, and establishment 
of new industries from abroad. These might be well known and 

461 


462 ECONOMICS OF CLOTHING AND TEXTILES 

established in foreign countries, but if new in England might be 
granted monopoly privileges. 

The American colonies were also eligible to receive patent grants 
under this statute, and such rights were issued to many American 
residents. At the meeting of the Constitutional convention after 
the Declaration of Independence, provision was made for the 
protection of patents, which were well defined by that time. 

The Patent Office, as it exists today, was established in 1836. 
A superintendent (the title has now been changed to commissioner) 
was put in charge and a staff of examiners was provided. At that 
time every inventor applying for a patent was required to file a 
model of his invention in the Patent Office. The Patent Office 
building, which has now been abandoned for a new building, was 
therefore designed largely as a museum. Before long the number 
of models became so great that it was impossible to display them. 
Drawings and reproductions of drawings were found to be much 
more feasible, and for the past fifty years or more the Patent Office 
has relied on these almost entirely. No models have been required 
since some time in the ’eighties or ’nineties of the last century, 
and a few years ago most of the old models were destroyed by order 
of an Act of Congress. This adoption of drawings for disclosing 
facts about the inventions for which patents are sought has been 
the greatest single change in the patent system. • 

The Patent System. The purpose of the patent system is to 
procure for the public definite information regarding new or im¬ 
proved devices and operations. A patent is a monopoly. It is 
substantially the only monopoly that our form of government, or 
any other form of government, believes is desirable. It is not a 
monopoly in the sense that the owner of the patent takes away 
from the public something the public already has. 

On the other hand, when a man makes an invention, he produces 
something that is entirely new, and which the public might never 
have had but for his activity in inventing it. In order to prevail 
upon him to disclose his invention to the public, rather than to 
keep it secret (and the invention may be kept secret), the govern¬ 
ment agrees to give to him for a limited period a monopoly on the 
thing that he has produced, as being new. The understanding is 
that he must, in order to get that monopoly, make such disclosures 


PATENTS, TRADE-MARKS, AND DESIGNS 


463 


as will make it possible at the end of the period for any member 
of the public, any one versed in the art, as we say, to employ his 
invention. 

The method by which this process is conducted is carefully pro¬ 
vided for by the Patent Statutes. To that procedure have been 
added the rules of practice of the Patent Office, and, of course, in 
the 140 years that the patent system has been in existence, a good 
many court decisions have fixed much of the detail of procedure. 

Possibly one of the best ways to see how the Patent Law functions 
is to look at the inventor who makes something worth while and to 
see what procedure he goes through, what happens to him and 
how he accomplishes for the public the purpose which the patent 
system has behind it. 

First, he must file an application in the Patent Office. The 
Constitution says that the right may be given to the inventor. 
This means that you can not, although you may have something 
absolutely new, get a patent for it unless you are the inventor. 
You can not overhear something, you can not learn incidentally, 
you can not learn honestly of some new device, and apply for a 
patent on it. The application must be filed by the inventor him¬ 
self. But the inventor may assign that application to whomsoever 
he wishes; then the patent is issued to the man to whom he 
assigns the patent, and this man may then own the invention. 

The application at the present time, developed through the 
growth of the law, consists of three papers. The first is the formal 
petition addressed to the Commissioner of Patents, in which the 
inventor identifies himself, says he has made an invention and 
would like a patent on it. The second is what is technically 
referred to as the specification and claims, accompanied by draw¬ 
ings. This is a careful description of the invention, indicating 
primarily what the invention is, what the purpose of the invention 
is, and giving in more or less elaborate detail, a review of the 
particular things which are necessary to carry out the invention. 
This description is the thing that the public wants for future use. 
It wants to know what the applicant has invented, so that after 
the monopoly expires the public can use it. It is likewise essential 
for the public to know, while the monopoly is alive, what features 
it can not use, so that this description, or specification as we call it, 


464 ECONOMICS OF CLOTHING AND TEXTILES 


is accompanied by a set of claims, one or several hundred. For¬ 
tunately there is generally a small number. Each of these claims 
sets out briefly the particular phase of the new invention on which 
the inventor wishes a monopoly. The specification itself is a de¬ 
scription which goes to the public after the monopoly expires. 

The claims are the things that determine the monopoly, or the 
things that the inventor keeps from the public. If the inventor 
has in his specifications described ten things, and in his claims 
only nine, that tenth thing presumably he dedicates to the public, 
and the public is free, even during the monopoly, to use that part of 
his invention. The statement of specifications and claims is signed 
by the inventor. 

Then follows the oath, in which the person applying for the 
patent swears that he is the inventor, that the invention has not 
been in public use, and enumerates a number of other conditions 
which the statutes provide must exist before the invention can be 
patented. In other words, if a man makes an invention and uses 
it for upwards of two years publicly, the presumption is that he 
does not want a patent on it, and is willing to give it to the public. 
So that when a person files his application, he must swear that he 
has not used the invention publicly for the 2-year period. Under 
the act of 1836, patents were granted for 14 years, and provision was 
made by statute to extend the patent for a 7-year period, if desired. 
Many of them were so extended on the payment of proper fees and 
showing — which meant that a patent grant was ordinarily for 
21 years. It finally was determined that the public ought to know 
what to expect with regard to patents. Too often when a patent 
had almost expired and the public thought it was to obtain posses¬ 
sion of the secret, the inventor would renew his patent for another 
7-year period. It was decided to have a single period, without 
chance for extension. That single period was made a little longer 
than 14 and a little less than 21 years — that is, for 17 years. 

The application having been filed in the Patent Office, the next 
question is, “'Is the patent going to issue ?” It is the function 
of the Patent Office to issue the patent, but it must first determine 
whether the patent should properly be issued. In other words, 
there is an examination of the application. At present this con¬ 
sists of two steps: First, to see that it is in proper form ; second, to 


PATENTS, TRADE-MARKS, AND DESIGNS 


465 


see, as far as may be, that there is an invention involved. That is, 
to make sure there is some consideration to be given to the public 
eventually in return for the monopoly that is to be granted. This 
examination is done through procedure which necessarily is fairly 
complicated, because it is a difficult problem to handle. The office 
is divided at present into 63 divisions, each division consisting of 
a chief and several assistants. To each division is assigned certain 
specific types of inventions. Thus, if you file an application for a 
patent on cotton machinery, it goes to one division; if you file an 
application for the manufacture of a new engine, it goes to another 
division. 

In these divisions each assistant is more or less a specialist in his 
own narrow field. The case will be placed on the proper desk, and 
this assistant will do the actual work of examining and determining 
whether a patent should issue. 

In order to tell whether an invention is new, naturally it is neces¬ 
sary to know what is old, so each of the examiners has a complete 
list of United States patents that have been granted relating to his 
particular subject. In addition, we have an exchange agreement 
with most of the foreign countries and procure copies of foreign 
patents. These are more or less properly classified and assigned 
to divisions, so that an assistant has before him, not only all 
United States patents relating to his subject, but all foreign patents 
as well. There are many patents taken out in the United States 
which are also taken out all over the world, and there are many 
patents taken out in only one country. 

In addition to these files, most of these assistant examiners have 
something of a library containing magazine literature or textbook 
literature relating to their individual subjects. Of course, in some 
subjects there are few textbooks, and in others the textbook is the 
chief source on which they rely. 

The man who makes the actual search to determine whether the 
invention presented to him is new or not, must first read the specifi¬ 
cations in the application, — he must understand what is there. 
If he can not understand it, he writes to the applicant and says, 
in effect, “You must correct your application and tell me exactly 
what the invention is.” The only way he can be relatively sure 
that he is granting a patent for something new is for him to have 


466 ECONOMICS OF CLOTHING AND TEXTILES 


before him all the old matter. The statute therefore provides that 
the Commissioner of Patents shall have also a so-called classifica¬ 
tion division of technical men, whose function it is to go over United 
States patents, foreign patents and literature, and to separate out 
and send through the proper channel everything which relates to 
the different inventions. 

Just here is located one of the important defects of the patent 
system at present. Because of false economy for many years the 
Patent Office has not been properly provided with funds to make 
this classification. The result is that the United States patents are 
not properly classified, and for foreign patents the classification is 
really extremely poor. As a result it requires almost eight months 
to get a patent. 

If a man has before him all the data relating to a subject, he 
can go through it in a much shorter time than he could if he must 
go to the library and look through all the related books, instead 
of at the page selected for him. If he has a group of foreign 
patents to go over and they are carefully classified so that he can 
look at a few pages and get the prior data, it will take much less 
time than if he has to go through all the literature. 

An invention is often made up of several steps. Ordinarily a man 
gets an idea — that is, a mental concept. He may then disclose 
it to some one else. He has done something toward showing 
that he has an invention. He may make a drawing of it, but fre¬ 
quently does not know whether it will work or not. He builds a 
machine, and then knows definitely that it works. This is what 
is called a reduction to practice. When he files an application in 
the Patent Office, he gets what is called a technical reduction 
to practice. 

The Patent Office system has another serious defect in that the 
information which the public wants, which is after all the whole 
foundation of the patent system, is not properly distributed. 
There are many inventions which have been patented, but which 
nobody knows about and nobody sees. The facts are buried in 
the files of the Patent Office. 

Finally, when the examiner reaches a favorable conclusion, the 
patent is allowed. That does not mean that a patent issues. A 
notice of allowance is issued, which merely states that the Patent 


PATENTS, TRADE-MARKS, AND DESIGNS 


467 


Office is satisfied that the patent should be granted. But the 
statute provides that within six months of that time the applicant 
must pay an additional final fee or printing fee of $25. If he pays 
that fee —and it is increased if he has more than 20 claims — 
within the six months’ period, the patent issues. If, however, he 
does not pay it within the six months’ period, he has another six 
months in which he may refile or renew his application, paying 
again the original filing fee, and then the application will be 
delayed further, possibly by an additional examination. 

A patent is a monopoly, and its owner has the right to exclude 
others from the use of a patented invention. A patent gives no 
one the right to manufacture anything. Every one has a natural 
right to manufacture anything if he does not interfere with the 
rights of some one else. But if one man is granted a patent for a 
book in which the leaves are sewed together at the back, he is the 
only one who can exclude everybody from making a book in that 
particular way. Now if a new feature appears, such as a book 
sewed in the back and with adiard board binding, that is an improve¬ 
ment upon the general idea of sewing the leaves together. The 
man who gets the patent on the hard board binding can prevent 
every one, including the inventor of the sewed book, from using the 
hard board binding, but the inventor who has the sewed book 
patent can prevent the second man from making any book with 
a sewed back, either with a hard board binding or without. 
When the patent issues, the Patent Office makes no effort to deter¬ 
mine whether the invention which the man describes will infringe 
an earlier patent. It frequently happens that a man has a patent 
that he thinks he has a right to go ahead with, when some one who 
has a patent anterior to his sues him and endeavors to prevent him 
from manufacturing. A true monopoly is weakened to some 
extent in such cases. 

One of the chief causes for delay in the Patent Office is the 
so-called interference procedure. Of the 70,000 or 80,000 patents 
filed every year there are from 3500 to 4000 inventions to which 
claims are made by two or more persons. Two men, one of whom 
may live in Boston and the other in San Francisco, may at different 
times invent the same thing. They both file applications for a 
patent. If both applications are pending, obviously they can not 


468 ECONOMICS OF CLOTHING AND TEXTILES 


both have patents. The statute provides that the patent is to be 
issued to the first inventor. 

An interference is then declared between the two inventors. 
Each is allowed to file an affidavit stating definitely the date when 
he made his invention, and a description of how he proceeded with 
it. There may occur a series of miscellaneous procedures to 
determine exactly the issue between the parties, and then each 
party is given the right to take testimony to prove his case, to show 
who was the first inventor, and to show what each one did. After 
that is done, each inventor has an opportunity to be heard in the 
Patent Office before an examiner of interference, who determines 
on the evidence before him which man he thinks is the first inventor, 
and awards the patent to him. 

By intensive publicity, costing many hundreds of thousands of 
dollars, the great industries of the country have tried to create the 
impression in the popular mind that all worth-while inventing is 
being done in their research laboratories, and that it is useless for 
individuals to attempt to experiment, study, and invent new 
devices. In other words, a form of patent competition has grown, 
which has allowed the wealthy organizations with much capital to 
compete in laboratories and litigation to their advantage, thus dis¬ 
couraging the progress of free inventive activity. 

Sometimes a company will buy and pool a number of patents 
and not use any of them during the entire patent period. This 
gives a virtual monopoly to the one owning the patents. For this 
reason the great industrialists of the country and the majority 
of the profession are against compulsory licenses. One company 
makes it a practice to find out just what patents are being issued 
for its type of industry; it then buys them all and pools them, 
and holds them and continues to use the old processes that per¬ 
haps are not as economical from an industrial standpoint as the 
new ones. 

Inventions. It will be interesting to consider some of the inven¬ 
tions of textile machinery, although it is obviously not possible to 
give a complete account of the many developments. 

The history of the invention of power machinery for textile 
manufacture illustrates the difficulties of granting patents. The 
equipment for carding, spinning, and weaving was very simple, 



PATENTS, TRADE-MARKS, AND DESIGNS 469 

quite similar to that used by the Egyptians, with the exception of 
the spinning wheel, which replaced the distaff in the 16th century. 

A series of inventions of cotton machinery between 1760 and 
1808 practically revolutionized the entire industrial system of 
Europe and America, and precipitated the so-called Industrial 


Spinning before Arkwright’s Time 

Revolution. The changes in the manufacture of cotton reflect 
very clearly the effects of the Industrial Revolution, not only upon 
production but also upon social and political institutions. 

One of the first inventions was the fly shuttle, which made it 
possible for one weaver to weave a wide breadth of cloth that 
formerly required two weavers. Since the invention of the fly shut¬ 
tle increased the production per worker by 100 per cent, it naturally 
meant more cloth woven for the world. This increased weaving 
production necessarily implied an increase in the demand for yarn, 
which outstripped the capacity of the hand carding, the spinning 
wheel, etc. The necessity for more yarn led to the invention of 
the spinning machine by Richard Arkwright, as described on 
pages 182 and 184. 

Arkwright represents an early type of manufacturer and capi- 





470 ECONOMICS OF CLOTHING AND TEXTILES 


talist who developed our factory system. He was not a striking 
example of high moral standards and sterling honesty, but he 
possessed qualities of leadership — perseverance, unity of purpose, 
ability to handle men, and knowledge of the principles and possi¬ 
bilities of power machinery. He did not invent the machines he 
claimed in his patents as his intellectual property, but he did 
utilize them in skillful combinations. Arkwright was the one who 
was able to commercialize the idea of spinning machinery, and he 
erected the first mill. 

The original ideas of the spinning machine came from a group of 
craftsmen, including Thomas Highs, a reed maker for looms; 
John Kay, a clock maker; John Wyatt, a carpenter; and Richard 
Arkwright, a dyer of hair. It was only through the combined 
efforts of all that the machine was developed. Most of these 
inventors, like Richard Arkwright, were not men with a high moral 
purpose, but acquisitive and self-seeking. Arkwright had vision 
fully to appreciate the economic possibilities of machine production. 

He was granted a patent for a spinning machine in 1769, but 
lacked financial backing to place the machine on the market. After 
a few years the bankers became interested and provided capital. 
The financial results were not encouraging at first and the bankers 
withdrew aid, but wealthy manufacturers who had been observing 
the machine came forward with aid. Labor difficulties — opposi¬ 
tion on the part of the workers to the introduction of power machin¬ 
ery, which meant replacement of hand labor — caused many riots 
and retarded the introduction of the machines in the mills. 

In 1771, Arkwright erected a mill in Crawford, England, on the 
river Derwent. The water supplied the power to the mill, since the 
steam engine was not used until twenty years later. In 1775, 
Arkwright was granted a patent covering a complete system of 
machinery for power carding and spinning. With two patents, 
he had practically a monopoly of machinery required for cotton 
manufacture. Not being able to meet all the demands for high 
grade yarn, he granted licenses for use of his machinery. 

The majority of competitors were perfectly willing to use Ark¬ 
wright’s inventions and machines, but many objected to paying 
the license fees and attempted to make small changes and modifica¬ 
tions in the machines, thereby escaping from the fees. Arkwright 


PATENTS, TRADE-MARKS, AND DESIGNS 


471 


brought suits against nine offenders, but the defense won on the 
ground that Arkwright had not fully described his inventions as 
required by law. For a few years litigation took place, his com¬ 
petitors finally united, and there developed a trial with imposing 
lawyers on both sides in which it was shown that Arkwright had 
secured his ideas from others. 

The Mule Frame. Hargreaves’ spinning jenny and Arkwright’s 
roller spinning frame were followed in 1779 by Crompton’s spinning 
mule, one of the most efficient machines, even to this day, that can 



Crompton’s Spinning Mule 


be found in the whole range of the textile industries. Arkwright 
had already attained great success in the production of yarn by the 
extensive application of the principle of pulling out the loose 
rovings by two or more pairs of drawing rollers. Hargreaves had 
also shown how to produce a thread by attenuating the fiber by 
means of the traveling carriage of the jenny. Crompton, however, 
laid the foundation of the present system of mule spinning by 
combining the essential features of the two machines and blending 
them into one. He applied the principle of roller drawing in order 
to attenuate the loose fluffy strand, and he utilized the traveling 
carriage as a reserve power with which to improve the quality of 
the thread and draw it out finer. Whatever Arkwright could do 
on his roller frame, the Crompton mule could also do, and some¬ 
thing additional. However much Arkwright improved his yarns 
by better carding and drawing, the mule could always step in and 










472 ECONOMICS OF CLOTHING AND TEXTILES 


give a finishing touch that was utterly beyond Arkwright s reach. 
As it was at first, so it is now : the mule as a spinning machine can 
do anything that the ring frame or any other frame can do, and at 
the same time turn out a better product. It combines in one 
machine both the new and the old principles of spinning, both the 
roller draft and the spindle draft in one and the same yarn. The 
mule, however, produces a slackly twisted yarn and is less produc¬ 
tive than the modern ring frame. 



Ring Spinning Frame 


Crompton’s original machine, made in 1779, contains every 
motion, or at least an equivalent for every motion, of the most 
complicated and perfected self-acting mules of the present day. 
Shortly after the invention was given to the public it began to be 
improved in various ways, until today it embodies the inventions 
of hundreds of the most intelligent men ever connected with any 
industry in the world’s history. It is universally acknowledged to 
be one of the most wonderful and useful devices ever invented. 
The actual operations of making a thread are, however, practically 
the same as left by Samuel Crompton over a hundred years ago. 
It is only in the details of mechanism involved in making the 
machine work automatically, and in greater productiveness, that 
the long line of inventors has been engaged. 

Today, such is the great size of self-acting mules, that they are 
often found 120 feet long and containing 1300 spindles, each one 








PATENTS, TRADE-MARKS, AND DESIGNS 


473 


spinning and winding 64 inches of thread in about 15 seconds, or 
a total of nearly 5,000,000 yards per day. One skilled workman 
and two boys are sufficient to give all the attention such a machine 
requires. 

The Ring Frame. At present there are two kinds of machines in 
use for spinning wool and cotton — the throstles in addition to the 
mules just described. The throstle, which is an extension of 
Arkwright’s original spinning frame, is employed for spinning 
warps because it is solid and firm. It maintained an important 
position in the spinning industry until a comparatively recent 
date, when it was superseded by the ring frame. The ring frame is 
a modified throstle, and preserves the latter’s chief features. It 
differs mainly in having the flyer replaced by a ring from which 
the machine takes its name. The ring is from one and a half to 
three inches in diameter, grooved inside and out, and is fitted with 
a flat steel wire shaped like the letter D, called the “traveler.” 
Its office is to serve as a drag upon the yarn, and by means of it the 
yarn is wound on a bobbin. Its size and weight depend on the 
counts of yarn to be spun; coarse yarns demand the largest rings 
and heaviest traveler; and the finer yarns the opposite. The ring 
frame is employed (particularly in cotton manufacture) for spinning 
both warp and weft from the lowest numbers up to about 50’s or 
60’s. In the United States the ring frame is the leading spinning 
machine at the present time, its use being greatly on the increase 
and its popularity growing daily. 

Looms. The increased production of yarn naturally caused the 
invention of a power loom. Cartwright, in 1774, constructed his 
power loom to apply either water power or steam to weaving. It 
was not at first a success, but in 1803 improvements by Thomas 
Johnson in dressing warp before it was put into the loom, and his 
devices to take up the slack in the cloth, eventually made the 
power loom practical. It became generally used in the cotton 
industry by 1815, though it did not make much headway in woolen 
or silk before 1835. Later devices were added to the loom for weav¬ 
ing fancy fabrics in design. Automatic devices then followed, as 
shown by the Northrop loom with automatic feeding shuttle head 
and drop wire connections; that is, when a thread breaks, a wire 
drops, stopping the loom. 


t 


474 ECONOMICS OF CLOTHING AND TEXTILES 


Silk weaving is still far from automatic. The weaver must keep 
the shuttle filled, clean the warp, keep the threads straight, and see 
that there are no imperfections. 

The most important improvement in the loom was the attach¬ 
ment for weaving elaborate designs called a Jacquard. It was 
devised by Joseph M. Jacquard. It is not a loom, but an append¬ 
age to looms, which, in the weaving of figured fabrics, automatically 
selects the warp threads and raises them when necessary. It was 
the damask loom that made possible the Jacquard. In fact, the 
main difference between them is that in one human skill and pa¬ 
tience accomplish what the other does automatically. The damask 
weaver puts in thread after thread by hand — over, under, through 
warp as the pattern requires. The Jacquard loom has weighted 
strings passing over a pulley to fall upon perforated cards. Each 
motion changes their position and lets some weights go through 
the holes, and draws up the warp threads to be skipped by the 
woof, while others strike the card and leave their strands in place 
to be regularly woven. The invention has been applied to many 
branches of weaving, and has worked wonderful improvement in 
all. 

Jacquard was the son of a poor silk weaver of Lyons, and was 
born in 1752. He was first employed as a bookbinder, afterwards 
as a type-founder and cutter; but, on the death of his mother, 
he assisted his father in weaving, and when he inherited a small 
patrimony upon his father’s death, he used it in setting up a silk 
factory. This proved unsuccessful, mainly because his time was 
spent in attempting various improvements in the processes with 
which he was acquainted. For want of a better occupation, he was 
at last forced to become a lime-burner and afterwards a charcoal- 
burner, while his wife supported herself at Lyons by plaiting straw. 
The machine that afterwards rendered him famous is said to have 
been conceived in 1790, but its execution was delayed by the 
breaking out of the Revolution, which drove him into the ranks, 
first of the insurgents, and then those of the Army of the Rhine. 
After seeing some active service, in which his young son was shot 
down by his side, Jacquard again returned to Lyons, where he 
succeeded in finding work. He saw in an English newspaper that 
a Society of Arts had offered a prize to any one who could invent a 


PATENTS, TRADE-MARKS, AND DESIGNS 475 

plan for weaving nets by machinery. He set his wits to work, and 
for his own amusement soon produced a loom adapted to the pur¬ 
pose. He made no attempt to obtain the reward, and after show¬ 
ing his invention to a friend, he put it aside and for some time 
forgot it. 

To his surprise, he was one day sent for by the prefect of the 
department, who inquired about the machine and requested him to 
make another, since the original had been lost or destroyed. This 
he did, and a few weeks later was summoned to Paris and intro¬ 
duced to Bonaparte. “Are you the man,” asked Carnot, the 
minister, “who pretends to do what God Almighty can not do — 
tie a knot in a stretched string ? ” Jacquard answered that he could 
do, not what God could not do, but what God had taught him to do. 
He still labored at his silk-weaving machines, and in 1801 a medal 
was awarded him for an invention which he exhibited in Paris, 
whereby one workman per loom was dispensed with in the weaving 
of figured silks. He was summoned to Paris again, and explained 
his device to Napoleon, who rewarded him with a pension of a 
thousand crowns, gave him employment in the Conservatory des 
Arts, and thus enabled him to exercise his ingenuity in other ways. 
At the conservatory was stationed a loom of Vaucauson’s, which 
suggested various important improvements in his own, which he 
perfected in its final and present state in 1803. 

The emperor encouraged the owners of silk factories to adopt the 
new loom, and many were set up at Lyons during the early part of 
1804. To Jacquard’s consternation, the new invention was fiercely 
opposed by the silk weavers, many of whom it threatened to de¬ 
prive of livelihood. The Conseil des Prud’hommes, which in our 
age might be described as a company of walking delegates, and 
whose business it was to watch over the interests of the Lyonese 
trade, seized his machines and made kindling wood and scrap-iron 
out of them in the public square. “The iron (to use Jacquard’s 
own expression) was sold for iron — the wood for wood, and the 
inventor was delivered over to universal ignominy.” 

The invention was too valuable not to have found its way into 
other countries, which by its means were enabled to rival and even 
to surpass the products of the French looms. Then it was that the 
Lyonese weavers saw the folly of their opposition and condescended 


476 ECONOMICS OF CLOTHING AND TEXTILES 


to adopt the invention of the man they had so cruelly persecuted. 
Many years before his death, which occurred in 1834, the inventor 
had the satisfaction of seeing his loom in almost universal use, 
and, as a consequence, his native city rapidly advancing. The 
Jacquard apparatus is now extensively used throughout the whole 
of the silk, worsted, and cotton manufacturing districts of France, 
England, and America. In 1876 a French manufacturing firm 
produced one of the most extraordinary specimens of silk weaving 
that probably has ever been executed. It is a portrait of Jacquard 
woven on a white ground with colored silk, representing that 
extraordinary man in his workshop, surrounded by his implements, 
and planning the construction of that beautiful machinery which 
now, in its increased perfection, renders a fitting testimony to the 
genius of the inventor. The work was woven with such truth and 
delicacy as to resemble a fine line engraving. There were a thou¬ 
sand threads in each square inch in both warp and weft. 

The Jacquard loom is used solely for weaving figured goods. 
In this loom a chain of perforated cards is made to pass over a drum, 
and the strings by which the threads of the warp are raised, pass 
over an edge with a wire or leaden weight of small diameter sus¬ 
pended from each. These weights at each stroke of the loom are 
presented to each successive card and some of them are intercepted 
by the card, while others pass through the holes therein, the latter 
thus determining which threads of the warp of the figure appear on 
the fabric. 

The Power-Loom. The first power-loom built in this country for 
weaving broad silks was made by William Ryle, of Paterson, N. J., 
in 1842, or two years after the loom for fancy weaving invented 
by Crompton. The introduction of the latter loom, which differed 
from the ordinary plain-weaving loom in having drop shuttle boxes, 
marked an important era in the domestic woolen industry, and in 
its developed condition is largely used at the present time. The 
building of the silk loom inaugurated an industry that has since 
become one of the most important branches of American textile 
manufacturing. 

Of all the American inventors who have contributed to the textile 
machinery of the age, and whose inventions have been of universal 
value, Erastus Bigelow is probably the most prominent. His 


PATENTS, TRADE-MARKS, AND DESIGNS 


477 


application of power to the loom for carpet weaving, which was 
brought out in 1848, not only served to revolutionize the manufac¬ 
ture of carpets, but gave an impetus to this branch of weaving 
such as had been given by nothing else since the introduction of the 
Jacquard apparatus. Heretofore, carpets were woven on hand- 
looms, which naturally made their production limited and the rugs 
expensive and out of the reach of ordinary people. The invention 
of the carpet loom brought within the reach of all, even the poor, 
the advantage of a beautifully colored carpet. 

Bigelow’s first loom was for weaving ingrain carpets, and was 
followed by his perfected loom for weaving the heavy and gor¬ 
geously patterned Brussels and tapestry carpets. The next great 
stride in machinery for carpet weaving came in 1860, when Halycon 
Skinner patented a loom upon which the hitherto unattainable 
weave of Axminsters and moquettes could be produced. Since 
then many improvements in detail have been added and the looms 
for carpets and upholstery fabrics are today the most perfect 
mechanisms in use, as well as among the most complicated. 

Knitting. The art of mechanical knitting is an English inven¬ 
tion. William Lee constructed the first knitting-frame in 1589. 
In accordance with the policy of the British people to keep their 
colonies dependent upon the mother country, there was a high 
penalty set by law for the exportation of knitting machinery, and 
woolen stockings manufactured on Lee’s frames formed an impor¬ 
tant item in the English trade with the North American Crown 
colonies. 

The earliest American record dealing with knit goods dates from 
1689, and can be found in the documents relating to the colonial 
history of New York (ix, 408 and 409). There a government 
official states that in bartering with the Indian tribes at the 
English Fort Orange (the present Albany, N. Y.), it was customary 
to give six pairs of stockings for the fur coat of one beaver, while 
the French at Montreal asked two beavers in exchange for the 
same amount of the commodity so highly valued by the natives. 

In the same year, 1689, German immigrants from the sect of the 
Mennonites landed farther south in America and settled near 
Philadelphia. They erected the first stocking frame in America 
at Germantown, Pa. Undoubtedly these settlers, coming from the 


478 ECONOMICS OF CLOTHING AND TEXTILES 


borders of the Rhine, had acquired the trade skill from their neigh¬ 
bors in Brabant, to which section some frames had been previously 
smuggled from England. 

Thus the knit-trade monopoly of the British in America lasted 
exactly 100 years and was broken by Germans. In 1695 there were 
about 1500 knitting machines active in and near London. Eighty 
years later (1775), there were already 150 knit-goods frames work¬ 
ing in Germantown, Pa., and near the Brandywine Creek. In 1865 
the annual production of woolen hosiery in Germantown is re¬ 
ported by reliable sources as amounting to $10,000,000. The 
American as well as the German competition in knit-goods manu¬ 
facturing caused an industrial crisis in England. In 1864 the 
hosiery manufactures in London had declined to only 74 machines. 
The English knit-goods traders, in order to be able to compete in 
the world’s markets, bought their goods in Saxony, where wages 
were lower and mass production brought about lower wholesale 
prices. 

During periods of industrial depression the English frame knitters 
by necessity turned to new inventions, and in 1864 William Cotton 
received patents on the first full-fashioning, flat knitting frame. 

During the French Revolution a French civil engineer — Sir 
Marc Isambert Brunei — had arrived in the United States as an 
immigrant. His ingenious mind invented the circular knitting 
frame in 1816, about five decades before Cotton brought out his 
improvement on the flat knitting frame. 

While the English and German manufacturers excelled especially 
in the development of the flat frame coulier and warp-knitting, 
the North American nation, with tremendous energy, developed the 
possibilities of the circular principle in knitting which had been 
evolved by Brunei during his stay in the States. Up to the year 
1925, the seamless hosiery machine production of the United States 
was leading all rivals in the knitting field in respect to gigantic 
production and export figures. 

The invention of power machinery was first applied to cotton. 
This was due to the fact that the cotton manufacture was first 
rapidly developed because more people in the world used cotton. 
The application of the inventions to woolen and worsted processes 
was not as easily carried out as in the case of cotton. The spinning, 


PATENTS, TRADE-MARKS, AND DESIGNS 


479 


weaving, and finishing of woolens and worsteds are difficult proc¬ 
esses, and it was a long time before automatic machinery was 
successfully applied to them. Silk was the last textile to be 
adapted to automatic machinery. 

Additional inventions in textile machinery were in the form of 
devices for refinements — improving the quality of cloth — and 
higher speed machines to cut production costs. 

One of the most striking features in silk manufacture is the 
multiplicity of processes which a piece of goods must undergo 
after weaving before it is ready to lay on the counter. A piece 
may be run over as many as 150 times in various processes after 
it comes from the loom before it is ready for shipment. 

In the silk, as well as other manufacturing industries, it is 
indisputable that while inventions have multiplied wages, these 
same inventions and competition have even more remarkably 
lowered prices, in spite of the fact that the protective tariff rate has 
remained comparatively level. And in many cases it is only the 
tariff that has made the development of the industry possible in 
this country — which has already been discussed on page 376. 

Rubberized Fabrics. The application of the use of rubber to 
clothing is illustrated in the cloth called mackintosh. The present 
use of rubber in the manufacture of clothing was discovered and 
perfected by Charles Goodyear, and although all the patents which 
he originally obtained have long since run out, his name will always 
be associated with the practical use of India gum in the trade. It 
was the use of sulphur combined with heat as a drier of the pure 
gum that first made his invention successful. Although rubber 
garments have been in use since 1823, there has been a very marked 
improvement in the manufacture in recent years. Twenty years 
ago the only rubber clothing made and worn in this country was the 
plain, black, rubber-surfaced gingham or cambric garment. The 
greatest change brought about in the manufacture of rubber cloth¬ 
ing has been the introduction of a water-proof cloth garment called 
a mackintosh. 

This is a double-texture fabric — cloth on both sides, with rubber 
between that is not visible. When made up, the garments resemble 
fashionably cut coats or cloaks, and are almost odorless. They are 
either light or heavy according to the quality of the material used. 


480 ECONOMICS OF CLOTHING AND TEXTILES 


Mackintosh cloth is prepared by spreading on the cotton or woolen 
fabric layer after layer of India rubber paste. Double-texture 
goods are made by uniting the rubber surfaces of two pieces of the 
coated material. The cloth is then cut in the desired shape for 
coat or cloak and the seams united by joining the soft material 
before it cools. There are many other cheaper kinds of water¬ 
proof garments made — such as single cloths with a rubber surface 
— but for durability and style the mackintosh takes the lead, and 
is said to be used in seventy-five per cent of all rubber garments of 
a dressy character now sold for both sexes. 

A line of water-proof clothing is made of a single gauzy texture 
with rubber facing. These garments are made from a variety of 
materials that imitate the latest styles of dress goods. They are 
also largely made in cambric, cashmere, silk, and wool, in different 
patterns. Silk garments of this character are not durable, as they 
are made delicate and tender by the application of the rubber com¬ 
pound, which causes them to tear and crack too easily. The 
reason given is that the oil in the silk rots the rubber. 

The Sewing Machine. The sewing machine, like most important 
inventions, was the result of the needs of its time, and was thought 
out and brought into use when the demand became acute for more 
speed and increased production in the manufacture of garments. 
The poverty of England’s seamstresses as told in Hood’s “The 
Song of the Shirt,” the need of uniforms for clothing the army in 
France, and the periodically sudden needs for garments by the 
whale fishermen of New Bedford and other New England fishing 
ports, all were reflected in attempts to improve upon sewing by 
hand. When these various attempts appeared, they attracted 
but little attention at first, except from those who feared their 
means of earning a living would be taken from them if a sewing 
machine became a possibility. The machines of Barthelemy 
Thimonnier used in sewing uniforms for the army in France were 
destroyed by a mob, and the development of what promised to be 
America’s first machine (that of Walter Hunt in 1834) was laid 
aside for fear of taking the bread out of the mouths of the seam¬ 
stresses. 

The early efforts to construct a machine to take the place of the 
human arm and fingers were met with the indifference of the 


PATENTS, TRADE-MARKS, AND DESIGNS 


481 



Howe’s First Sewing 
Machine 


general public, but certain groups of workers with the needle saw 
in these inventions a menace to their crafts, and endeavored to 
destroy them wherever they appeared. 

Another portion of the public was 
amused at the claims made for the 
freak “Yankee” machines and were 
curious enough to pay money to see 
the “contraptions” exhibited in side 
shows. 

While the first idea of a sewing 
machine appeared in England, the 
credit for producing the first prac¬ 
tical machine belongs to Americans. 

Most of the early efforts to sew by 
machinery were based upon an imi¬ 
tation of hand sewing. All such in¬ 
ventions proved failures, because hand 
sewing is slow and intermittent, as it 
is necessary to use a definite length of thread which passes 
through the cloth its full length at every stitch. This requires the 
working arm of the sewer to travel a long distance, and to renew 

the length of thread frequently. 

The possibility of sewing by 
machinery was practically demon¬ 
strated over 100 years ago; but it 
required the combined efforts of a 
generation of inventors to improve 
the sewing machine so as to make 
it really a labor-saving instrument. 
Its history is a record of rapid ad¬ 
vancement in mechanical move¬ 
ments and combinations of devices 
which had apparently never been 
thought of until the close of the 
18th century. 

Elias Howe patented a sewing 
machine in 1846. Howe’s invention was sold to a corset manu¬ 
facturer in England for 250 pounds, and the English manufacturer 



Howe’s Improved Sewing 
Machine 








482 ECONOMICS OF CLOTHING AND TEXTILES 


secured a patent in his own name in England in 1846. He en¬ 
gaged Howe on weekly wages to adapt the machine to manufactur¬ 
ing purposes. Howe returned to America in poverty and found 
many manufacturers had used his patent rights. Howe brought 
suit against the men who infringed on his patents and after many 
years of litigation he secured royalties amounting to $2,000,000. 
He died shortly after his patent expired in 1867. 

The quarrels over patent rights were by no means confined to 
Howe, as each individual company was suing all of the others on 
one claim or another. Finally, Orlando B. Potter, president of 
the Grover & Baker Co., conceived the idea of combining the 
various interests and pooling all the patents covering the essential 
features, which would enable them to control the sewing-machine 
industry, instead of continually fighting and trying to devour one 
another. He pointed out that while Howe and the three large 
companies then suing one another controlled all the basic patents, 
the pending lawsuits, if carried to a conclusion, might be disastrous 
to them all. His argument was convincing, and thus was formed 
the “combination,” which for several years was the terror of all 
unlicensed manufacturers. 

The invention of the sewing machine is one of the most important 
factors in placing modern wearing apparel within the reach of all. 
When one considers the number of stitches in making a single 
garment such as a shirt — 20,649, — the value of the machine is 
apparent. 

The rate of hand sewing is between 30 and 40 stitches per minute 
per operator. The foot-power machine operated by a single person 
makes 900 stitches per minute, or the equivalent of 30 people 
working on hand stitches. The power sewing machine operated by 
a single person makes 4000 stitches per minute — or the equivalent 
of 133 people sewing by hand. 

When we look at the progress made in sewing machines, we 
might expect them to create a social revolution, for a good house¬ 
wife by one of the machines will sew a fine shirt, doing all the seams 
in fine stitching, in a single hour. The time thus saved to wife, 
tailors, and seamstresses of every description is of incalculable impor¬ 
tance, for it allows them to devote their attention to other things 
during the time that used to be taken up with dull seam sewing. 


PATENTS, TRADE-MARKS, AND DESIGNS 


483 


It is too soon yet to estimate the full effect of the sewing machine 
upon human life and destiny. It ushered in an epoch of cheap 
clothes, which means better clothes for the masses — more 
warmth, more cleanliness, more comfort. The indirect conse¬ 
quences of the invention of the sewing machine reach far beyond 
our ken. Time was when about half the human race was occupied 
chiefly in making clothes. When the machines took the vocation 
away from them, they turned to other employments. The invasion 
of all occupations by women and the sweeping changes which have 
taken place in their relations to the law, society, and business can 
be ascribed in large measure to the sewing machine. 

Minor Devices. In addition to major inventions of textile 
machinery, patents have been issued on many minor devices. 
Various parts and attachments of wearing apparel were originally 
made by hand, but the 19th century brought automatic machinery 
that molded, cut, shaped, and finished the device by a series of 
machine operations. To illustrate: Let us consider the steps in the 
manufacture of the simple hook and eye : (1) wire is made from the 
raw material, (2) the wire is cut off in sections of proper length, 
(3) the piece of wire is bent into a hook, (4) the ends of the hook 
are bent so as to form the holding loop, (5) the double wire is 
forced into a hook part. In a similar manner the eye is formed. 

Trade-Marks. The primary and proper function of a trade¬ 
mark, according to definition, is to identify the origin or ownership 
of the goods to which it is affixed. In this definition, as in so many 
other things, legal evolution has not kept pace with functional 
change. Five or six centuries ago it would have been accurate, but 
not now. The modern trade-mark is a development from, or com¬ 
posite of, two distinct forms of mark : first, the regulatory or pro¬ 
duction mark, designating source; and second, the proprietary 
mark designating ownership. 

The medieval craftsman, not only in England but throughout 
Europe, was compelled by statute, by local ordinance, or by the 
regulations of his guild, to affix his mark, not for the purpose of 
exploiting his product, but so that by this mark defective work¬ 
manship, short weights and measures, shoddy goods, etc., could 
be traced, and the guild monopoly in production in a certain area 
could be protected. As to guild monopoly, it meant simply that 


484 ECONOMICS OF CLOTHING AND TEXTILES 


if cloth bearing the trade-marks of London cloth workers’ guilds 
were found in Germany, the monopoly of cloth in that area was 
being infringed. 

It might be interesting to note that these merchant marks 
gradually became pseudo-heraldic devices. They were pseudo- 
heraldic, because the use of those marks invited the disapproval 
of the Royal College of Heralds of London, who were of the opinion 
that “trade extinguisheth gentry,” and were exceedingly annoyed 
to find that these practical merchants were really obtaining the 
pseudo-heraldic devices without paying the fee for enrollment of 
the devices at the Herald’s College. 

Each individual had a different mark, and these marks were 
regularly enrolled — registered in the books either of the city or 
in those of the particular guild. They were an identification 
of quality, not necessarily of inferior quality, but as a clue to the 
makers so that they might be looked up in the event of inferior 
quality, and punished. Each guild had its own trade-mark regis¬ 
tration bureau. 

The individual adopted the mark and then enrolled it in the 
guild. At first these marks were of a very simple kind. There 
does not seem to have been much ingenuity about them. They 
were like cooper’s marks. It was only later that the marks became 
ornate and decorative. Finally, a gradual evolution took place, 
and the merchant’s mark turned into the modern trade-mark, 
followed by the development of the law affecting these two. Until 
the nineteenth century, the common law courts of England were 
practically silent on this subject, except that in the 17th century 
one action on a case of deceit in the misuse of a trade-mark took 
place. This is the only case we find mentioned until the famous 
decision of Lord Chancellor Hardwicke in 1742, when he actually 
refused to enjoin the infringement of a trade-mark on the ground 
that in so doing he would be encouraging monopolies. 

It is worth while to remember this decision, because, as we shall 
see in dealing with certain present-day problems of trade-mark 
protection, the court is still seemingly haunted by this fear of 
monopoly, whereas actually there is no monopoly involved. 

This, however, did not mean, as is commonly believed, that 
until the 19th century there was no law in England on trade-marks. 


PATENTS, TRADE-MARKS, AND DESIGNS 


485 


On the contrary, there had been developed there, commencing with 
the Middle Ages, particularly within the courts of the trade guilds, 
an elaborate body of doctrine on this subject, applicable to partic¬ 
ular industries in particular localities, such as the clothiers of 
London. This body of doctrine not only included the right to 
protect one’s trade-mark as a symbol of good will, but also to sell 
it in connection with a going business, to rent it, and to bequeath 
it by last will and testament. 

The theory of the American and English common law and equity is 
that the trade-mark must be used in connection with a business in 
order to be protected. It can not exist at large or in a vacuum. It 
is an instrumentality of commerce, and commerce implies business, 
and business implies a going business, not merely a theoretical one. 

With the breaking up of the guilds, the delocalization and unifica¬ 
tion of industry, the expansion of the Industrial Revolution, the 
growth of advertising, and the development of national and inter¬ 
national trade, the relation of producer to consumer changed and 
the significance of the trade-mark changed accordingly. Goods 
passed from the producer to the consumer, through perhaps a 
dozen different hands — agent, jobber, purchasing syndicate, 
retailer, etc.; furthermore, in many industries the ingredients or 
materials comprising the goods upon which the trade-mark was 
ultimately used were assembled from, or were the aggregate of, 
innumerable other sources of which the producer knew nothing. 
The trade-mark ceased to be a mark of ownership in any sense, and 
remained a mark of source or origin only in a very limited sense. 
With regard to the source or origin of such well-known trade- 
marked articles as “Tiffany,” “Fruit of the Loom,” etc., the courts 
have indulged in the paradox of admitting that even though the 
actual or physical source of the goods is unknown, or is purely 
anonymous and may mean nothing to the consumer, the misuse 
by an infringer of such marks deceives the consumer as to the 
source or origin of the infringer’s goods. The fact of the matter is 
that under modern conditions of marketing and large-scale adver¬ 
tising, the trade-mark is not merely an indication of source or 
origin; nor is it merely used as a distinguishing mark or symbol 
a commercial signature. It is also a symbol of good will, and is 
an agency for the creation and perpetuation of good will. It 


486 ECONOMICS OF CLOTHING AND TEXTILES 


reaches over the retail merchant’s shoulder and offers the goods 
to the customer; it is the most constant, active, and extensive 
salesman in the employ of the manufacturer today, representing 



Give your finished silks . . . 

A SOFTER, FULLER HAND 
GREATER TENSILE STRENGTH 
BETTER LUBRICATED FIBRES 


By using 

SULPHONATED OLIVE OIL S-370 

a highly sulphonated, pure Olive Oil (entirely free 
from adulterants). Oil S-370 assures you of the 
best results because it is: 

COMPLETELY SOLUBLE 

EXTREMELY PENETRATING 

ABSOLUTELY RESISTANT TO SALT AND ACID 

Try Sulphonated Olive Oil S-370 for pure dyes or weighted silks. 

A trial quantity will he yours upon request. 

Advertisement for Silk Manufacturers 
Note the trade-mark and appeal to logic 

a tremendous investment in ingenuity and advertising, of which 
the taxing statutes have taken the keenest cognizance. It has, 
at the same time, this feature of the old guild production mark — 
it is a guaranty to the consumer that the goods bearing it will give 



PATENTS, TRADE-MARKS, AND DESIGNS 


487 


him the same satisfaction or the same service that other goods 
bearing this mark have previously given him. 

The modern concept of the function of the trade-mark is fun¬ 
damental in attacking various problems. There is, for instance, 
the problem of the use of similar marks on dissimilar goods, which 
is one of the most common and important questions with which 
trade-mark litigation deals today. The old notion was that there 
could be no unfair competition without actual market com¬ 
petition. 

The point is that the modern trade-mark, particularly the coined 
or fanciful one, which has impressed itself on the public mind 
through the ingenuity and investment of its owner, should in simple 
justice receive the broadest possible protection. There is no 
justification in law or in morals for its misappropriation or 
for its application to any goods other than those of the owner 
of such marks as “Celanese,” etc., and not only our courts 
but those abroad are more and more realizing that it is the first 
comer in the field who is entitled to all consideration in this 
matter. 

A movement has been started to protect corporations and 
companies that spend millions of dollars in advertising a particular 
product under a trade-mark which is nothing but a symbol of good 
will, and to permit no other branch of endeavor to use it. If, 
however, every particular name that is used in business were copy¬ 
righted, the language would not be able to supply enough 
names. 

Therefore protection should be limited as much as possible. 
The public, that is, the consumer, is paying for the trade-marked 
product, and is the one who pays the bill for advertising. To 
permit an owner who had reaped a tremendous fortune out of the 
trade-marked articles to extend that mark and have a monopoly 
of that name on dissimilar products is going farther and farther 
along the direction of great combinations. 

In many cases in recent years, individuals or corporations have 
sought a trade-mark that was very similar to the trade-mark of 
some other company by which millions of dollars had been spent in 
advertising. Such infringements are very hard to decide and to 
regulate. 


488 ECONOMICS OF CLOTHING AND TEXTILES 


At present it is necessary to register the trade-mark separately 
in each country, and this is an exceedingly expensive and trouble¬ 
some operation. Indeed, the whole system of trade-mark registra¬ 
tion is expensive and unsatisfactory, especially in the United 
States. The manufacturer must go to a great deal of trouble and 
expense to register his mark, and receives nothing except a piece 
of paper which says, “This is prima facie evidence of ownership.” 

Every trade-mark application filed in the Patent Office receives 
official action within 30 days. If the trade-mark application is 
found to be proper, the present law requires the publication of that 



Trade-Marks of Different Textiles 


fact in the Official Gazette, and after it is published in the Gazette 
the Patent Office must wait 30 days for opposition. Then a new 
search is made, and if no opposition occurs, the mark is sent to the 
Government Printing Office. It takes the Government Printing 
Office four weeks to print it. About 18,000 applications are 
received annually for trade-mark registration. 

The Hague Convention grants what we call “national treat¬ 
ment.” That is to say, a national of the United States in any 
country' which is a party to that convention has the same rights 
in that country as its own nationals, and the nations of those 
countries correspondingly have the same rights here. In each case 
any one wanting protection for trade-marks or patents must carry 
out all the requirements of the law of that particular country, so 
that if each country requires registration, then in each country the 
American citizen must go through the formalities of registra¬ 
tion. 

It was formerly the custom to charge citizens of other countries 
$300 to obtain a patent, and at one time the United States charged 
the subjects of Great Britain $500. Under this international agree¬ 
ment, however, we are bound to treat the nationals of the countries 
signatory to these conventions the same as we do our own nationals. 











PATENTS, TRADE-MARKS, AND DESIGNS 


489 


This applied to both trade-marks and patents. The fee for regis¬ 
tration of trade-marks in the United States is $15. 

Protection of Designs. We have discussed the value of patents 
and trade-marks. There is another important subject closely re¬ 
lated to them that is very important in the wearing apparel and 
textile field — that is, the question of the protection of designs of 
fabrics and of individual parts of wearing apparel as well as the 
design of the whole costume. 

All over the world there has been a tendency for low-grade 
manufacturers and designers to steal the designs of fabrics and 
individual wearing apparel as well as the design of the whole cos¬ 
tume. This stealing is called “design piracy” and is practiced by 
low-grade designers and manufacturers on the well-established 
manufacturers and designers who spend large sums of money 
creating their designs. 

Some say it is possible to secure protection under the copyright 
law. The copyright law is founded upon two principles. One is 
that the thing that is protected by copyright — the thing that the 
courts will protect — must be an original work, not necessarily 
absolutely new, but not capable of being held to be worthless. 
In that respect the copyright law differs from the patent law. The 
patent law requires a thing to be both new and original. Another 
difference is that the copyright law only prevents copying, but the 
patent law prevents the manufacture, sale, or use of any article 
which impedes the patented invention. These distinctions be¬ 
tween patent law and copyright law are fundamental and should be 
incorporated in a pure copyright bill, because it is the experience 
of centuries that work that is protected by copyright need only 
have the characteristics of originality. 

The law of copyright in the United States demands that the gov¬ 
ernment must search and determine whether a design is original 
before it can issue a copyright. This requires from three to six 
months, and since wearing apparel is seasonal, its period of useful¬ 
ness is over by the time the question of copyright is settled. Hence 
the need of legislation to protect manufacturers and designers in 
their ideas as much as others are protected in their property rights. 

We saw in Chapter II that some psychologists assert that there 
are no original designs. The retail dry goods stores have opposed 


490 ECONOMICS OF CLOTHING AND TEXTILES 


design protective legislation on grounds that it would mean con¬ 
stant litigation over the question of the protection of the designs 
of textiles and wearing apparel. 

Foreign countries are inclined to protect manufacturers and 
designers more than the United States. This is due to the tradi¬ 
tions of the countries: foreign countries are inclined to be more 
monopolistic and the United States more competitive. 

The following report shows how the French protect their de¬ 
signers : 

It is disclosed in the bulletin of the Protective Association, of which 
A. Trouyet, of the couture house of Madeline Vionnet, is president, that 
raids were conducted in March, 1932, on copyists. Models, canvas 
designs, and sketches were seized. Three small dressmaking houses were 
visited, and 20 robes, six canvas designs, and 34 sketches were confiscated. 
Two millinery houses were raided and three hats, alleged to be copies of 
those of the Maison Lewis, were seized. At the request of the Maison 
Colcombert, a silk firm was relieved of six pieces of ribbons, and on the 
complaint of the Maison Alexandrine, a small glove house gave up 25 pairs 
of gloves alleged to be copies of Alexandrine originals. 

Attempts have been made to pass practical design legislation 
through Congress, so that manufacturers, designers, and others 
may obtain immediate design registration so as to protect them 
against infringement for the purpose of minimizing the possibility 
of design piracy and providing the public with designs which have 
the stamp of originality and which will continue during the coming 
season. 

Trade organizations such as the Silk Association of America have 
assisted by allowing facilities for registration of print and woven 
designs during the past five years. 

Design Registration. The routine of the United States Patent 
Office requires several months for the proper registration of a design 
or trade-mark of wearing apparel. Since designs and trade-marks 
are frequently seasonal products, it follows that the wearing apparel 
has been designed, manufactured, and is on the market before 
the applicant has received notice of the proper registration of the 
design or trade-mark. This drawback has caused much inconven¬ 
ience and actual loss of money, as well as stifling the natural 
development of original designs. 


PATENTS, TRADE-MARKS, AND DESIGNS 


491 


The Silk Association of America founded in August, 1928, a 
design registration bureau for the purpose of providing a general 
clearing house for silk designs, and to meet a need long felt in the 
trade for an expeditious service in design registration. 

Speed in comparing with the files designs submitted for regis¬ 
tration is consequently an important feature of the design registra¬ 
tion bureau’s program. Checking, photostating, and filing of 
designs has been planned so efficiently that the design bureau is 
able to render a 48-hour service to the trade. The applicant is 
then informed immediately as to whether the design has been found 
eligible for registration, and if so, he is given the registered number 
for his design. 

Prior to the opening of the design bureau, much inconvenience 
and actual loss of money was experienced by silk manufacturers 
who, having no knowledge as to what designs were on the market, 
engraved rollers, printed designs, and started to sell their goods 
only to find that the same or a similar design had already been 
printed, frequently on cheaper material. 

In the short space of time in which the design bureau has been 
functioning, fifty cases of such duplication have been brought to 
the attention of the parties concerned and settled satisfactorily 
prior to processing. Thousands of dollars have been saved to 
the registrant, and loss of time in promoting the fabric has been 
avoided. 

An intelligent and efficient staff has been trained by the design 
bureau to search the files rapidly and accurately. All designs 
submitted are held in absolute confidence, and no one but the 
design bureau staff is permitted to examine these files. 

As soon as designs come in for registration, they are checked, 
classified, and photostated. Files are then searched, effect on the 
eye of the ordinary observer or purchaser being the basis by which 
it is determined whether or not the design is a duplicate of or 
similar to another design. 

If the design submitted is registerable, a photostat copy is 
returned to the owner together with the original design and a 
certificate of registration. If the design is a duplicate of another 
design, it is returned to the owner with a rejection slip. In cases 
of close similarity, however, arrangements are made, if the parties 


492 ECONOMICS OF CLOTHING AND TEXTILES 


involved so desire, for an informal meeting at the Association 
headquarters to discuss the similarity and to determine a course 
agreeable to both parties. 

Although the design bureau was originally organized to register 
designs intended for use on costume silks, registration services 
have been extended, at the request of cotton and rayon manufac¬ 
turers, to include the registration of designs for rayon and cotton 
costume fabrics. 

The ethical and moral influence of the design registration bureau 
has been felt widely in the trade during the past year. The bureau 
has the cooperation of retailers and designers as well as of manufac¬ 
turers, converters, and dyers. It not only aims to bring about an 
amicable settlement of cases of design duplication but is at the 
service of the entire silk, cotton, and rayon industries for regis¬ 
tration of designs and consultation on design duplication prob¬ 
lems. 

Designs intended for printing, embossing, soda printing, or 
Jacquard weaving on silk, cotton, or rayon may be submitted for 
registration at the Silk Association of America headquarters, 
468 Fourth Avenue, New York City. 

Domestic forms are provided for registration of designs intended 
for processing within the United States. Designs processed out¬ 
side the United States, if imported as material for sale in this 
country, may be submitted for registration on foreign forms by the 
actual owner of the design and material. 

To assure registration of designs which are in commercial use, 
designs which are not reported by the printer as being sent for 
processing within ten days after registration will be withdrawn 
from registration. 

Registration is open to the entire trade. All designs are regis¬ 
tered for two years. The following are the requirements for 
registering domestic prints, Form 1A : 

An engraver’s copy of the design to be registered must be sent, prior 
to processing, to the design bureau together with an application form for 
each design and information as to fabrics on which the design is to 
appear. 

The name and address of the printer, the name and address of the firm 
applying, the signature of the firm’s officer or employee submitting the 


PATENTS, TRADE-MARKS, AND DESIGNS ’ 493 


information, and the legal seal, if the applicant is a corporation, must be 
included in the application. A notary’s signature should be affixed to 
each application in the place designated. 

The design number and the number of rollers to be used must be 
included. 

Accompanying each application there should be a check for $4.00 to 
cover the cost of registration. If the design is not registerable, a charge 
of $1.00 will be made for search and the balance refunded to the applicant. 

Jacquard domestic designs must be an original mill sketch sent, prior 
to processing, to the design bureau accompanied by application form. 

Design number, name and address of the mill to which the sketch is to 
be sent for processing, the name and address of the firm applying, the 
signature of the firm’s officer or employee who completed the information 
and the legal seal, if the applicant is a corporation, must be included. 
A notary’s signature should be affixed to each application in the proper 
place. 

Accompanying each application must be a check for $4.00 to cover 
cost of registration. If the design is not registerable, a charge of $1.00 
will be made for search and the balance refunded to the applicant. 

Foreign prints and Jacquards must be an original sketch. Strike-off or 
sample of material must be sent to the design bureau accompanied by 
application, to be furnished by the bureau. 

If a sketch or strike-off is submitted, it must be followed up within six 
weeks by a sample of the finished material with the facts as to yardage 
actually imported for sale in the United States and information as to date 
of first importation. 

If a sample of material is submitted, a full repeat should be shown. 
In the case of small motifs, a piece at least 8| X 11 inches should be 
submitted. It is well to avoid, whenever possible, sample with red and 
black color combinations. 

Design number, the nature of the pattern submitted (whether sample 
or sketch), number of colors, fabrics on which the design is to appear, 
verification of the right to the exclusive use of the pattern in this country 
should appear in the application. 

The name and address of the firm applying must be included together 
with the signature of the firm’s officer or employee who completes the 
information, and the legal seal if the applicant is a corporation. A notary’s 
signature should be affixed to each application in the place designated. 

Accompanying each application must be a check for $4.00 to cover 
the cost of registration. If the design is not registerable, a charge of $1.00 
v/ill be made for search and the balance refunded to the applicant. 


494 ECONOMICS OF CLOTHING AND TEXTILES 


Labels designed for use on wrappers of silk, cotton, and rayon 
fabrics printed from registered designs may be obtained from the 
design bureau. The labels state that the design has been registered 
with the design registration bureau and provide a blank where the 
registration number may be added. 

Use of these labels on fabrics of registered design is a means of 
giving the retail buyer and consumer an added assurance that every 
effort has been made to protect the exclusiveness of the design. 

Rumors of design copying are frequently circulated in the market. 
When definite complaints are made and the bureau is supplied with 
the available facts, investigation is made. It is necessary, however, 
that the design registration bureau be informed promptly of such 
cases, and that information be reported on especially prepared 
blanks supplied by the design bureau and which contain questions 
to be answered by the complainant. 

In several instances of such complaints it has been possible to 
stop the duplication of designs by mutual agreement of the parties 
involved. In all cases of duplication it is desirable that an accurate 
statement of facts be kept in the design bureau’s files as a matter 
of record and reference for the trade. 

The Fashion Originators Guild of America, Inc., composed of 
originators in the textile and apparel fields, is seeking the coopera¬ 
tion of the retailers in the movement to protect and popularize 
original styles, on the basis that such a movement represents the 
best opportunity to do a profitable business. 

“Fashion,” which is of utmost importance to women, has almost 
entirely lost its significance. This is not due to economic conditions 
alone, for even in 1929, the peak year, the down trend had already 
begun. The real cause is that an overwhelming percentage of all 
promotional effort and advertising expenditure has been devoted to 
exploiting imitations of style, imitations of design, and imitations of 
quality, with the result that women have become so confused that 
they no longer recognize originality — the keynote and basis of all 
fashion. 

To remedy these conditions, the Fashion Originators Guild of 
America, Inc., has been formed. Its purposes are as follows: 
(1) to revive woman’s interest in fashion, (2) to stimulate her desire 
for originality, (3) to impress upon her that fashion and quality go 


PATENTS, TRADE-MARKS, AND DESIGNS 


495 


hand in hand, (4) to overcome the mistaken idea that an imitation 
can replace an original. 

To accomplish these purposes the Guild intends to employ an 
extensive advertising campaign in metropolitan newspapers and 
leading fashion magazines. 

Few people realize the expense attached to developing designs 
of fabrics, wearing apparel, and complete costumes. High-class 
designers and manufacturers know that design is a powerful factor 
in value, especially in wearing apparel. It is a well-known fact 
that designers and manufacturers must be encouraged to do their 
best work. The foreign countries that have protected designs have 
the finest quality and value. The United States, on the other 
hand, have not given the same encouragement to their designers 
and manufacturers, and the result has been that quality and design 
have fallen in value. 

Fashion. Fashion is a term that applies to the shape, form, 
color, and composition of wearing apparel, etc., at a given period. 
The French use the term la mode for fashion. 

We saw in an earlier chapter that wearing apparel is not used for 
a body covering alone, but for artistic and psychological values as 
well—to make us appear more beautiful or attractive by covering up 
weaknesses and emphasizing the better points of the human form, 
and also to arouse our emotions and feelings as the clothing, etc. 
make us distinctive. In addition, we saw in Chapter II that the 
eye soon tires of the same wearing apparel, and that frequent or 
long use of the same apparel tends to make us less distinctive. 
For these reasons our psychological wants of wearing apparel 
increase rapidly. Hence producers must provide frequent changes 
in wearing apparel of varied kinds and designs to satisfy all types of 
persons of both sexes at different periods of life, at different geo¬ 
graphical locations and seasons, and for various occasions. 

These changes are carefully planned in design by representatives 
of the different manufacturers of wearing apparel as follows: 

To show how the different organizations making wearing apparel 
cooperate in developing style, let us consider the style for 1932. 
Since the year marked the 200th anniversary of the birth of Wash¬ 
ington, celebrations were in order. Public attention was centered 
during the year on the life of Washington. Hence the central 


496 ECONOMICS OF CLOTHING AND TEXTILES 


theme for the style tendencies for the year was expressed as follows 
in a fashion resume early in that year: 

The inspiration of the Washington bi-centennial celebration, expressed 
in bright red, white, and blue shades and military effects is seen in the 
fashions which will be featured in 1932. 

The association’s color chart for 1932 shows a range from black through 
a variety of blues, particularly the cadet and bright navy shades, two 
beiges, two browns, bright red, green, orange rust, maize, and various 
accent colors. 

Berets, shoulder capes, shining buttons, and shorter skirts for daytime 
will heighten the military effect. 

The models displayed indicate that the silhouette is slightly more 
molded than last season, and generally more youthful. The fashion 
experts state that bell-boy jackets, tight waists, built-up waistlines, 
high necks, military trimming, exaggerated shoulders and sleeve fullness 
at the top will accomplish the desired effect for the youthful figure. 

For the mature figure the effect will be accomplished in simulated high 
effects, surplice closings, adjustable waistlines, cowl necks, drop shoulders, 
sleeve fullness below the elbow, and discreet softening touches. 

Jackets, which in their simplest form are little more than scarves, are 
an integral part of the season’s dress. They range from bolero scarfs to 
finger-tip lengths. Collarless coats and suits which require separate 
scarfs are also important. Various fabrics, but especially novelty furs 
with both long and short hair, beige and gray fox, and a new leopard- 
stenciled lapin will be seen in these scarves. 

Fabric types and textures essential to the new silhouette will find 
ribbed weaves, corded effects, diagonals, rough surfaces, serges, and 
flannels, a wide variety of silks in crinkly effects, dull surfaces, some 
smooth surfaces, many simulated hand knit, and crochets predominating. 

Hats this season will be tilted over one ear, revealing clusters of curls 
on the uncovered side. Turbans and straw hats with broken lines ap¬ 
peared in the display yesterday, though the beret note still predominated. 
In shoes, the ghillie type, with high ankle lacing, was the most popular 
model for sports wear. Tailored opera pumps and oxfords will continue 
as favorites for street wear, the models indicated. 

Cowl necks and covered shoulders were features of the evening frocks, 
and the bridge frock was distinctly shorter. Several full-length evening 
cloaks were shown. 

All the day dresses were more abbreviated than last season. 

Accessories carried out the gay military note, the red, white, and blue 
theme being used repeatedly. 


PATENTS, TRADE-MARKS, AND DESIGNS 497 

Another seasonal report on styles shows the popularity of mesh 
fabrics. 

In order to meet the fad of the modiste founded on recent medical claims 
of the beneficial influence of direct sunlight on the body, you can prac¬ 
tically clothe yourself, from toe tips to hat crowns, in things that will give 
the breezes and you a break this summer. Mesh upon your hands and 
legs, perforations in your shoes and hat crown, and a papery lightness in 
your jewelry. Just as long as you keep the soles of your feet on solid 
leather, you may go as far as you like with the open-air idea. 

Some of the smartest summer hats are those with mesh crowns. They 
may be afternoon hats, with wide straw brims and crowns of starched 
crocheted linen or mesh for the crown. They may be tiny knockabout 
hats with both brim and crown of soft crocheted wool. The mesh b6rets 
are being done in linen now and are made so shallow that they merely 
cap one small corner of the head. But they are cute and inexpensive and 
grand for active sports costumes. 

Some of the crocheted caps have stunning scarfs to match. The linen 
crocheted scarf is one of the newest. It is heavy in weight, but done in a 
cool-looking openwork pattern. Two of these scarfs in contrasting 
colors — deep blue and yellow, for example — twisted together about 
the neck will do a heap for a white sports costume. 

Then there are gloves made to match the hats, too. If your hat crown 
is of plain mesh, you can get plain mesh gloves. The bracelet ones are 
good looking. If the crown of your hat is of a fancy crocheted weave — 
maybe starched — you will find gloves made with matching cuffs of the 
same openwork fabric. 

Some of the other open-air tricks of the season are the silk mesh gloves 
in pastel shades, fastened with two pearl buttons, for evening; the cro¬ 
cheted wrist-length gloves for sports that look like children’s winter 
woolens except for the air holes; the perforated pigskin gloves for golf, 
with holes for the knuckles; the perforated felt outfit, with sleeveless 
jacket, bag, and gloves to match; the many mesh sweaters —one in 
Roman stripes, with a polo shirt neckline, struck our especial fancy; 
the fine hair-net-like mesh stockings, to be worn in ivory with white shoes, 
or in pale summer pastel shades with sports frocks; the shoes of perforated 
kid; the shoes of cotton mesh; and the shoes combining various types 
of fabrics, always with some air space or meshlike material over the toes. 

Style changes in accessories are even more frequent than general 
costume changes. Leather is the sole material for many of the 
newest accessories, just as it often provides the main item of 


498 ECONOMICS OF CLOTHING AND TEXTILES 


trimming for frocks and coats. It has been most delightfully used 
by many of the leading designers. 

It is interesting to reflect on the ingenuity of those whose mission 
it is to create a constant succession of novelties. Season after 
season they turn out new and delightful articles and adroitly 
sidestep the bizarre or the banal. 

The way in which style trends are developed in one part of the 
costume may be interesting: 

The style of the shoe is dominated by fashion. All styles are 
related, that is, every part of our dress is influenced by the pre¬ 
vailing fashion, ideas of color, fabric, or garment outline. To 
illustrate: When short skirts are stylish, women wear mannish 
shoes to harmonize with them; on the other hand, with long skirts 
they must have a shoe that is neat and small, hence the short vamp. 
When women wear white in the summer, cool canvas shoes spring 
into favor; when brown and blue dress materials are to be used, 
tan shoes are worn to harmonize, etc. 

After the shoe has been decided upon, it is necessary to work 
out an exact reproduction. An expert model maker, called a last 
maker, produces a last, a wooden model of the shoe. In order to do 
this, it is necessary to lay out certain plans or specifications for the 
details of the manufacturer of the shoe. There are certain parts 
of all feet that have fixed measurements. 

To illustrate: For each size, the length of the shank, that part of the 
sole of the foot between the heel and ball, is always the same in every 
person’s foot. The part of the foot back of the ball or large toe joint 
conforms to certain fixed measurements. These definite measurements 
form a basis by which the last maker originates new styles by shortening, 
lengthening, widening, or narrowing the space in front of the toes, but 
always retaining the true and fixed measurements of the back of the 
last. 

When the last maker desires to produce a new style, he takes an old 
last, and by tacking pieces of leather on some parts of it (front of the toes), 
he builds it up and cuts off other parts. This patched-up last is taken to 
a special machine (lathe), where a number of duplicates are turned from 
a block of wood. 

The pattern maker is the man in the factory who makes patterns out of 
heavy pieces of cardboard bound with brass, in the shape of the various 
pieces of leather required to make the upper part of the shoe. 


PATENTS, TRADE-MARKS, AND DESIGNS 499 


The pattern maker has found by experience that the top part of the 
shoe also conforms to certain fixed measurements, and by working in 
cooperation with the last maker he needs only to change the front part 
of the vamp to bring out the latter’s ideas. With these measurements as 
a foundation, he puts forth from time to time different style uppers, such 
as buttons, lace, blucher, fixings, scrolls, straps, ties, pumps, etc. This 
is the way new style tops originate. 

After the manufacturer has approved of sample patterns, the pattern 
maker receives an order for a certain quantity of patterns to be made over 
a certain last which is submitted to him. Working on the fixed top 
measurements and the last submitted as a basis, the pattern maker draws 
plans for a model pattern. The standard size of a model pattern is size 7 in 
men’s shoes and size 4 in women’s. He is also given an order for a certain 
number of widths; for instance, B, C, D, and E, and he draws out on 
paper a complete set for each width in the model size. These four sets of 
model patterns are reproduced and cut out in sheet iron by hand. But 
from these sheets any number of iron models and any size regular card¬ 
board pattern can be reproduced by a machine. 

Wood to be made into lasts comes to the shoe manufacturers in a rough, 
unchiseled form. The lasts are made of maple wood; hollow forms used 
by traveling salesmen and window trimmers are made of basswood. 

The making of the model of the last is the most exacting operation in 
the factory. It is produced by a most important machine. The principle 
of this machine is based on the pantograph; that is, it will turn from a 
rough block of wood an exact copy of the model last; or it will enlarge or 
reduce a duplicate of any other size or width. So, from a single model 
last, such as the manufacturer has decided upon, any number of lasts can 
be made, of any size or width. The machine itself consists of two lathes. 
On one is placed the model and on the other the block of wood. The 
model is held against a wheel by a spring. By adjusting this wheel, any 
desired width last can be obtained, and by adjusting a bar in front of the 
machine any length of last can be produced from the block of wood. 

The lathe, when in motion, revolves both the last and the model, the 
model being pressed against the wheel, which is really a guide for the 
revolving knife that digs into the block of wood and regulates the depth 
that the knife is allowed to cut. In this manner the model is reproduced 
from the block, which is also regulated as to size and width by the wheel 
and by the bar. This machine is so accurate that a tack driven into the 
model to locate the center of the last is reproduced by a sort of a wooden 
pimple in the block of wood when finished. The model sole pattern is now 
tried on the half-finished last to insure accuracy. 


500 ECONOMICS OF CLOTHING AND TEXTILES 

One can notice in the figures of lasts that the turning lathe has left stubs 
of wood on the toes and heels. These must be finished to a “templet/’ 
The templet is a measure or guide used to indicate the shape any piece of 
work is to assume when finished. From the heel and toe of the model, 
a piece of iron is shaped on an exact arc of that last, and is used on the 
heeler machine as a guide to form an exact copy of the heels and toes of 
the model. This machine works very rapidly, and by the aid of an 
irregular shaped, revolving knife it quickly transforms the toes and heels 
to the desired shape. The bottoms are again tried out on a sole pattern 
and the last number, the size, and the width are stamped on. 

We now have the last as a solid piece of maple wood turned to the 
desired shape, size, and width. Were it possible to insert and extract the 
last in this form from the half-finished shoe, no other steps would be 
necessary in last manufacture, but inasmuch as the leather is stretched 
very tightly over this last a little later, it necessitates the introduction of 
some method that will facilitate a quick removal of the last from the shoe. 
This is accomplished by cutting it into two parts and making a hinged 
heel. The fact that the slightest change in measurement changes the 
size of the shoe necessitates great care in the introduction of the hinge 
as a part of the last, and in order to insure accuracy and uniformity in 
all the lasts, they are marked with templets and gigs. The hinge must 
be placed inside of the last. 

The finished last is so constructed that it can be readily inserted or with¬ 
drawn from the shoe, and the strong hinge provides the last, when inserted, 
with the same rigid qualities as though it were one piece. The center 
of the last is indicated, as before stated, by a reproduction in the side of 
the last of the tack that was placed in the model. This is the mark that 
locates the position of all the holes, and it is done by a “gig” in the follow¬ 
ing manner: 

A gig is a piece of steel having cylinders that guide the bit of the boring 
machine in an exact perpendicular line. This gig, being placed on the 
last in the position marked by the turning machine, forms the accurate 
location of the bolt holes that hold the hinge. 

After the hinge is placed in the last, it goes to the ironers to have the 
bottom put on it, if it is a McKay last, and a heel plate if it is a welt. 

The bottom is again tried and the plate filled up to the same. The 
last is then ready to go to the scouring room. In this room the last 
goes through three operations, first of which is ruffling. This consists 
of scouring with a coarse grade of quartz. This operation must be carried 
on so that the sole lines and insteps are not brought into contact with 
the quartz. 


PATENTS, TRADE-MARKS, AND DESiGNS 


501 

The second operation, medium grinding, is done with a fine grade of 
quartz, and in this operation, also, the worker keeps away from the toe. 
The third operation is done with a much finer-grade quartz, the operator 
going over the entire last. The last is now ready for polishing, and after 
that, for a heavy coat of shellac. It is polished and waxed on a leather 
wheel. Then it goes into the shipping room ready for shipment to the 
manufacturer. 

Costume Designs. The designs for the complete costume are 
made as follows: Each designing house of Paris that has world 
standing brings out from 300 to 1000 original dress designs a year. 
Each designing house has one head designer, who is usually the 
executive head of the house. From 20 per cent to 30 per cent 
of the models are discarded after the manikins have displayed 
them, so that only the best of the designs are retained. 

The models that are retained are placed before the public. Cus¬ 
tomers call and select one of the models, and decide to have a copy 
made with certain changes to meet personal taste. The copy is 
ready for a try-on in a week’s time, then finishing touches are made 
and it is ready for the customer. 

The houses have between 5000 and 10,000 customers each year, 
and each costume must be adapted to the special requirements of 
the customers, such as measurements, personal tastes, abnormal 
proportions, texture of skin and color of hair, so that every costume 
represents a separate manufacturing process. No standardization 
is allowed in these houses, as each customer desires to have a cos¬ 
tume that reflects her individuality. 

An original costume is frequently developed after a great expendi¬ 
ture of time and money — sometimes costing as much as $1000. 
It is then copied and produced in the same materials at one-tenth 
the cost, or $100. Such costumes are displayed on models in 
fashion shows and public places. They soon appear at leading 
social functions — formal balls, the President’s reception, on 
Palm Sunday and on Easter, at Palm Beach, etc. The descriptions 
of these costumes are given in great detail in newspaper accounts 
and fashion notes. Soon similar models are placed on the market 
composed of cheaper materials. 

The history of any style shows that it passes through a number 
of stages during its popularity: (1) the original style or model, 


502 ECONOMICS OF CLOTHING AND TEXTILES 


composed of the best material — pure silk, etc.; (2) a substitute 
made of cheaper material, but in the same model — a copy in 
cotton and silk; and (3) cheaper copies of similar design but of the 
cheapest materials and workmanship. People then tire of the 
style and it passes. 

Piracy consists of taking a fine design and reproducing it in an 
inferior or cheaper material, as explained in the above para¬ 
graph. 

The economic life of wearing apparel or other commodity is the 
period through which it retains its utility and therefore its appeal. 
Hence wearing apparel has a limited economic life of several 
months during the season. At the close of the season, it is out 
of fashion. This is particularly true of hats, whose style utility 
may even be less than a season. 

QUESTIONS 

1. (a) What is a patent? (6) Why does the government encourage 
patents? (c) What have patents to do with the subject of economics of 
clothing? 

2. (a) Give a brief history of the granting of a patent. (b) Why is 

a patent a monopoly ? (c) Should the government encourage monopolies ? 

3. (a) Describe the organization of the Patent Office. ( b ) State the 
steps in securing a patent. 

4. Describe the patent system. 

5. ( a ) How long does it take to grant a patent? ( b ) What is accom¬ 
plished during this time? 

6. What are some of the defects of the patent system in the United 
States ? 

7. If an inventor seeks a patent in this country, how can the govern¬ 
ment be sure the patent was not granted previously in Russia ? 

8. What is meant by the expression “interference” between two 
inventors? Explain in detail with illustrations. 

9. Describe briefly the history of the invention of power textile 
machinery. 

10. Does Arkwright represent the average inventor or promoter of 
inventions? 

11. Why was it necessary to invent a power spinning frame after the 
invention of the fly shuttle ? 

12. Why did the invention of the spinning frame cause the invention 
of the power-loom? 


PATENTS, TRADE-MARKS, AND DESIGNS 


503 


13 . Describe briefly the difficulties encountered by Jacquard in placing 
his loom attachment on the market. 

14 . Explain briefly the history of the invention of the first knitting 
power machine. 

15 . Why were not the inventions of power textile machinery applied 
immediately to wool and silk as well as cotton ? 

16 . Explain the invention of the sewing machine and the difficulties 
experienced in placing it on the market. 

17 . Explain the economic importance of the invention of the sewing 
machine. 

18 . Compare stitching by hand and by machinery. 

19 . Give a brief outline of the history of Elias Howe in inventing the 
sewing machine and his difficulties in holding to his patent rights. 

20. (a) What is a trade-mark? ( b ) State the value of a trade-mark, 
(c) Give a brief history of trade-marks in industry standards. 

21. Is it possible for one to use a trade-mark in silk and apply it to 
jewelry? 

22. (a) What is meant by a copyright? (6) How does it differ from 
a patent? 


CHAPTER XII 


ACCOUNTING AND COST FINDING 

Importance. Every manufacturer and trader of wearing apparel 
should be able at all times to know the exact status of his business, 
the cost of production of his goods, the cost of selling, and the 
conditions of profit or loss. According to experts most failures in 
the textile and clothing business are due to lack of knowledge about 
fundamental costs of production, selling, etc. Such information is 
important, not only to the business man but also to the consumer. 
If the latter is informed about the various factors that enter into 
the price of textile products, he is better able to appreciate real 
values. 

In the production of wearing apparel from the raw material 
until it is a finished product in the hands of the consumer, there is 
more or less expense attached to every operation or handling. 
Since the purpose of production is to prepare the wearing apparel 
for sale at a profit, it is necessary to keep an accurate account of 
the cost of each operation and transaction from the raising of the 
raw material to the packing of the finished articles and until it is 
placed in the hands of the consumer. 

In order to have a fair profit and meet the competition of others 
it is necessary not only to keep an accurate account, but also to see 
that the cost of everything from raw material to finished product 
is reduced to a minimum. 

Definition. The system of recording the transactions involved 
in the manufacture and sale of wearing apparel, etc., is called the 
accountancy or bookkeeping of wearing apparel. One division of 
accountancy very useful in the industry is that of cost account¬ 
ancy. It is a system of records that enables the manufacturer 
to determine with accuracy not only the production cost of wearing 
apparel, etc., but also the cost of the different elements that enter 

m 


ACCOUNTING AND COST FINDING 


505 


into the total cost, such as material (cotton), labor (weavers, etc.), 
power, and each other manufacturing expense. 

Formerly cost finding was largely a form of guess work. But 
with the keen competition of the last generation, manufacturers 
have been obliged to reduce the cost of production rather than to 
raise the price of the product, in order to meet competition. This 
is particularly true in the case of all forms of wearing apparel, 
where the margin of profit is small. 

Principles. There are certain fundamental principles used in 
accountancy that must be strictly followed in recording transac¬ 
tions. In order to secure uniformity in recording these transac¬ 
tions, certain typical books or forms are used. Uniform methods 
of cost finding have been developed by trade organizations and 
associations. 

Bookkeeping. Bookkeeping is a system of recording business 
transactions for the purpose of showing increases and decreases 
in assets and liabilities, including capital. An account is debited 
when it receives values and credited when it delivers values. 

Invoice. When a merchant sells an order of goods (merchan¬ 
dise) to a customer, he sends with it a bill, called an invoice , 
unless the customer has paid cash at the time of the sale. An 
invoice contains an itemized list of the merchandise sold, as well 
as the following information : 

(а) The place and date of the sale. 

(б) The terms of the sale (usually printed in small type); i.e., cash 
or a specified number of days’ credit. Sometimes a small discount is 
given if the bill is paid within a short, specified period. 

( c ) The quality, name, and price of each item, placed on the same 
line; and the entire amount of each item, called the extension , is placed 
in a column at the right. 

(d) Discounts are deducted from the bill if they have been promised. 

(e) Extra charges, such as cartage and freight, are added after taking 
off the discount. 

When the amount of the bill or invoice is paid to the merchant, 
he marks the invoice as follows: 

Received Payment, Date 

Name of Firm 

Per name of authorized person. 


506 ECONOMICS OF CLOTHING AND TEXTILES 


This is called receipting a bill. 

The following examples of invoices will illustrate the points 
mentioned: 

Goods are Charged for the Convenience of Customers and Accounts are Rendered Monthly 

R. A. McWhirr Co. 

DEPARTMENT STORE 

FALL RIVER, MASS. 


A. A. MILLS, Pres’t & Treas. 

J. H. MAHONEY, Supt. 

R. S. THOMPSON Sec'y. 

Purchases for Young 

September, 1932 215 High St., City 


/Vo, Order Number 719 


Date 

Articles 

Amounts 

Daily Total 

Credits 

Sept 4 

2 Doz C Hangers 

90 

180 




2 “ Skirt " 

45 

90 



5 

120 Long Cloth 

15 

1800 




34| Cambric 

51 

189 



6 

522 B Cambric 

18 

9396 




100 B Nainsook 

16 

1600 




24 Doz Kerr L Twist 

120 

3480 




8 Doz Tape Measures 

25 

200 




84 “ W Thread 

51 

4284 




1 10/12 Doz Tape 

25 

46 



9 

1 Gro Tambo Cotton 

520 

520 




\ Doz Bone Stillettos 

46 

23 




\ “ Steel “ 

46 

23 




40 Paper Needles 

31 

140 




20 " 

31 

70 




2 Doz M Plyers 

600 

1200 




2 Boxes Edge Wire 

125 

5400 




12 “ Even Tie Wire 

180 

2160 




24 " Brace “ 

225 





2 “ Lace 

160 

320 




2 Pk Ribbon 

125 

250 




2 Rolls Buckram 

90 

180 




48 Yd Cape Net 

15 

720 



13 

100 Crinoline 

5 

500 




125 

5 

625 



















ACCOUNTING AND COST FINDING 


507 


TELEPHONE 

ASHLAND 4-4560 


John C. Wilwood Corporation 

Manufacturer & Commission Merchant 

Ribbons & Silks 
Two Park Avenue 
New York 

TEXTILE HIGH 




Sold to 351 

WEST 18TH ST 

CABLE ADDRESS 
;• CODICIL •• 

SL 

NEW 

YORK CITY 



VIA 


MESS 

DATE 

FEB 4 1932 

ACCOUNT 

P 

TERMS 

NET COD 

INVOICE NO. 

04839 

AMOUNT 

11 02 NET 


Commercial Factors Corporation, factor, 2 Park Ave., New York 

If this Bill is not found to he correct in all respects Commercial Factors Corporation 
must he notified at once. 


PATT 

YDS 

NO 

PCS 

PRICE 




2048 

50 

3 

3 

95 

2 

85 






LESS 7 i 


20 

2 65 

2048 

50 

3 

1 

95 


95 






LESS 7 i 


07 

88 

2048 

50 

2 

1 

75 


75 





LESS 7 i 


05 

70 


PEARL 

50 

5 

1 

1 50 

1 

50 


i t 

50 

7 

2 

1 95 

3 

90 







5 

40 






LESS 7 i 


38 

5 02 


No Claims Allowed after Ten Days or after Pieces Are Cut 
Goods Delivered to Common Carriers or Sent via Parcel Post Are at the Risk of the 

Purchaser 


Open Account. A course of business dealing still continued 
between two parties is called an open account, or an account of 
which up to date there has been no settlement made. Such an 
account is also termed an account current, and formerly abbreviated 
%, a sign now almost exclusively used for account. A stated 
account is an account or statement showing the result of a course 
of transactions for adjustment or settlement between two parties. 



















508 ECONOMICS OF CLOTHING AND TEXTILES 


Most firms carry accounts by which customers are allowed to 
make purchases which are charged against them in a book of record. 
Payment is made once a month, the bill being rendered on the last 
day of the month or the first day of the following month. 

Ledger. Whenever an invoice is sent to a customer, a record of 
the transaction is made in a book called a ledger. 

The pages of a ledger are divided into two parts by means 
of red or double lines. The left side is called the debit and the 
right the credit side. At the top of each ledger page the name 
of a person or firm that purchases merchandise is recorded. The 
record on this page is called the account of the person or firm. 
When the customer purchases merchandise, the amount is re¬ 
corded on the debit side of his account. When merchandise or 
cash is received from the customer, it is recorded on the credit 
side. The date, the amount, and the word Mdse, or cash is 
usually written. 

We debit an account when it receives value, and credit an account 
when it delivers value. 


E. D. REDINGTON 


1934 






193/ 






Jan. 






Jan. 2 

Cash 

a 

109 

810 

58 

12/2 

Balance 

a 


810 

58 

2 

Note^60 day 


114 

1500 


2 

Mdse. 


100 

3057 

50 

9 

Return 

b 

115 

575 


10 

Mdse. 

b 

100 

575 


25 

Cash 


109 

500 


22 

Mdse. 


115 

375 


27 

Return 


115 

157 

50 







31 

Browne’s Acct. 












(transferred) 


115 

397 

53 


Specimen Ledger Page 

A summary of the debits and credits of an account is called a state¬ 
ment. The difference between the debits and credits represents the 
standing of the account. If the debits are greater than the credits, 
the customer named on the account owes the merchant. If the 
credits are greater than the debits, then the merchant owes the 
customer. 

The system of debits and credits demands that every complete 
entry consist of at least two accounts of equal amounts. To 




















ACCOUNTING AND COST FINDING 


509 


illustrate: If you sell 100 suits of clothes for cash, the complete 
entry of this transaction demands a debit to the cash account 
equal to the sums received, and a credit of 100 suits to the mer¬ 
chandise account. 

The accuracy or correctness of accounts may be checked by 
summarizing the balance of all the accounts in a statement, called 
a trial balance. The balances of each side of the trial balance 
must be equal. 

Balance Sheet. A balance sheet is usually made quarterly, semi¬ 
annually, or annually. It lists assets, including inventory items 
and liabilities. The difference between assets and liabilities indi¬ 
cates the present worth of the business. 


Assets 


Cash.. 

Accounts receivable. 

Merchandise inventory. 

Building and land. 

Boilers, elevators, etc. 

Machinery. 

Pafpri . 

. $40,779 

. 213,931 

. 312,909 

. 213,909 

. 70,066 

. 1,826,183 

. 2,657 

Investments. 

. 23,349 


. 578 

Truck. 

. 1,070 

Prpnaid mtiPrPst . .. 

. 520 

Prpnpiirl in si Iran . 

. 737 

Prpnp irl f.flYPS . 

. 2,000 

$2,708,894 


Liabilities 

. 1.125,000 

flJZ .". 170,997 

Reserve for depreciation. 

. 747,542 

. 225,000 

. 250,000 


. 85,485 

ribbUlUlt& pdjauiv. 

Commissions due H.&W. 

. 5,983 

. 24,000 

Reserve for doubtful accts. 

. 59,852 

. 15,032 

A roil b lOl O .. 

$2,708,894 

Inventory 

. $136,380 

tt • uw .... 93,188 

rLUBierj' . 

. 19,792 

. 63,549 

Total. ® 312 ' 909 

































510 ECONOMICS OF CLOTHING AND TEXTILES 


The assets are arranged in order in one column and in the oppo¬ 
site column are the liabilities and proprietor’s interest. The total 
of the assets must equal the total of the liabilities and capital, be¬ 
cause assets minus liabilities gives us capital, and capital is the 
proprietor’s investment. Present capital compared with previous 
capital shows the amount of profit or loss for the period of opera¬ 
tion. 

On page 509 one way find a quarterly statement of a knitting 
mill for March, 1932. 

Notice the different items under assets: cash to meet emer¬ 
gencies and for office requirements, pay rolls, current operating 
expenses, etc.; accounts receivable are the amounts due the firm 
for delivery of goods. The merchandise inventory represents 
goods in process and finished goods. The items on buildings, 
equipment, patent rights, etc., represent the plant and machinery. 
Prepaid interest on borrowed capital, unexpired insurance on build¬ 
ings and taxes are all included under assets. Note that the item 
of surplus under liabilities represents funds for emergencies, such 
as purchase of stock and dividends not earned. The item mort¬ 
gage is an issue of bonds. 

Capital stock and surplus technically are not liabilities. They 
are the owner’s interests or equities. Many textile mills like 
Gotham Mill present their assets and liabilities as shown in the 
above statement. 

Inventory. The inventory represents in detail the amount of 
physical stock on hand. It includes the value of the stock — raw 
materials, goods in process, and finished products. The price 
usually assigned to the stock in the inventory is the price paid for 
it. But in times of depression, when prices have fallen, banks de¬ 
mand the market price of the stock the day of the inventory. In 
a falling market a firm shows a loss due to the changes in price 
from purchase cost to the market price on the day of the inven¬ 
tory. 

All the profits of a business are not declared as dividends. A 
part is retained for unforeseen expenses, and this amount is called 
a reserve fund. Sometimes when the business has not earned a 
dividend during the quarter, the dividend is declared and taken 
from the reserve fund or surplus. 


ACCOUNTING AND COST FINDING 


511 


Profit and Loss. A merchant must sell merchandise at a higher 
price than he paid for it in order to have sufficient funds at the end 
of the transaction to pay for his operating expense, clerk hire, 
rent, etc. Any amount above the purchase price and its attend¬ 
ant expenses is called profit; any amount below purchasing price 
is called loss. 

A merchant must be careful in figuring his profit. He must have 
a set of books so arranged as to show what caused either an increase 
or reduction in the profits. 

There are certain special terms used in considering profit and loss. 
The first cost of goods is called the net or prime cost. After the 
goods have been received and unpacked, and the freight, cartage, 
storage, commission, etc., paid, the cost of the merchandise has 
been increased to what is called the gross or full cost. The total 
amount received from the sale of goods is called the gross selling 
price. The sum of expenses above the cost connected with the 
sale of goods subtracted from the gross selling price is called the 
net selling price. A merchant gains or loses according as the net 
selling price is above or below the gross cost. 

There are two methods of computing gain or loss, each based on 
the rules of percentage. In the first method, the gross cost is the 
base, the per cent of gain or loss the rate, the gain or loss the per¬ 
centage. The second method considers the selling price the base. 

First Method : Based on Cost Price. 

Profit = Selling Price — Cost Price. 

Loss = Cost Price — Selling Price. 

Per Cent of Profit = 

Per Cent of Loss U 

This method of computing profit is now almost obsolete. A 
modem merchant would not use it. Unless a problem states that 
the calculation is to be based on the cost, the second method, 
based on the selling price (given below) is to be used. 

Example 1. A small knitting mill was bought for $14,990 and 
sold at a profit of $550. What was the per cent of gain over cost? 

Solution : X 100 = yfjg = 3.7%. Ans. 





512 ECONOMICS OF CLOTHING AND TEXTILES 

Example 2. A merchant buys a suit for $25 and wishes to sell 
it at a gross profit of 40% on the cost. What is the selling price ? 
Arts. $35. 

Process. Since the mark-up (gross profit) is based on the cost, we find 
40% of $25 ($25 X 40%) which is $10, the gain. Adding the gain ($10) 
to the cost we get $35, the selling price. 

Example 3. A dealer sold a loom at a profit of $115, thereby 
gaining 18% on cost. What was the selling price? 

Solution : If $115 = 18% of cost, which is 100%, 

1% = W = 6.3889, 

100% = $638.89 cost 
Adding 115.00 profit 

$753.89 selling price 

Second Method : Based on Selling Price. 

Profit 

Per Cent of Profit = ming pHce - 
Loss 

Per Cent of Loss = ming p n -' 

Many merchants find that it is better business practice to figure 
profit on the selling price rather than on the cost price. Many 
failures in business can be traced to the practice of basing profits 
on cost. We must bear in mind that no comparison can be made 
between per cents of profit oncost until they have been reduced to 
terms of the same unit value or to per cents of the same base. 

To illustrate: It costs $100 to manufacture a certain article. The 
expenses of selling are 22%. For what must it sell to make a net profit 
of 10% ? Most students would calculate $132, taking the first cost as the 
basis of estimating cost of sales and net profit. The average business 
man would say that the expenses of selling and cost should be computed 
on the basis of the selling price. 

Solution : Expenses of selling = 22% 

Profit = 10% 

= 32% on selling price 
cost on $100 = 68% selling price. 

100% = $147.06 selling price. 

Example 4- An article costs $3.75. 
show a profit of 25% ? Ans. $5. 


What must it sell for to 





ACCOUNTING AND COST FINDING 


513 


Process. Deduct 25% from 100%. This will give you a remainder of 
75%, the percentage of the cost. If $3.75 is 75%, 1% would be $3.75 
divided by 75, or 5 cents, and 100% would be $5. Now, if you marked 
your goods, as too many do, by adding 25% to the cost, you would obtain 
a selling price of about $4.69, or 31 cents less than by the former method. 

The percentage of cost of doing business and the profit are figured 
on the selling price. 


Table fob Finding the Selling Price of any Article 


Cost 

TO DO 


Net Per Cent Profit Desired 

Business 

1 

2 

3 

4 

5 

6 

7 

8 

9 

10 

11 

12 

13 

14 

15 

20 

25 

30 

35 

40 

50 

15% 

84 

83 

82 

81 

80 

79 

78 

77 

76 

75 

74 

73 

72 

71 

70 

65 

60 

55 

50 

45 

35 

16% 

83 

82 

81 

80 

79 

78 

77 

76 

75 

74 

73 

72 

71 

70 

69 

64 

59 

54 

49 

44 

34 

17% 

82 

81 

80 

79 

78 

77 

76 

75 

74 

73 

72 

71 

70 

69 

68 

63 

58 

53 

48 

43 

33 

18% 

81 

80 

79 

78 

77 

76 

75 

74 

73 

72 

71 

70 

69 

68 

67 

62 

57 

52 

47 

42 

32 

19% 

80 

79 

78 

77 

76 

75 

74 

73 

72 

71 

70 

69 

68 

67 

66 

61 

56 

51 

46 

41 

31 

20% 

79 

78 

77 

76 

75 

74 

73 

72 

71 

70 

69 

68 

67 

66 

65 

60 

55 

50 

45 

40 

30 

21% 

78 

77 

76 

75 

74 

73 

72 

71 

70 

69 

68 

67 

66 

65 

64 

59 

54 

49 

44 

39 

29 

22% 

77 

76 

75 

74 

73 

72 

71 

70 

69 

68 

67 

66 

65 

64 

63 

58 

53 

48 

43 

38 

28 

23% 

76 

75 

74 

73 

72 

71 

70 

69 

68 

67 

66 

65 

64 

63 

62 

57 

52 

47 

42 

37 

27 

24% 

75 

74 

73 

72 

71 

70 

69 

68 

67 

66 

65 

64 

63 

62 

61 

56 

51 

46 

41 

36 

26 

25% 

74 

73 

72 

71 

70 

69 

68 

67 

66 

65 

64 

63 

62 

61 

60 

55 

50 

45 

40 

35 

25 


Rule. Divide the cost (invoice price with freight added) by the 
figure in the column of “net rate per cent profit desired” on the 
line with per cent it cost you to do business. 


Example. If a machine costs. $60.00 

Freight. 1.20 

$61.20 

You desire to make a net profit of. 5 per cent 

It costs you to do business. 19 per cent 


Take the figure in column 5 on line 19%, which is 76. 

76|$61.2000|$80.52 the selling price. 

60 8 
400 
380 
200 
162 

Profit. There is a fascination in business, particularly if it is 
your own business. This fascination or charm prompts most peo¬ 
ple to exercise their ability to the greatest extent. If this statement 









































514 ECONOMICS OF CLOTHING AND TEXTILES 

is true, why are there so many failures, particularly in the cloth¬ 
ing and wearing apparel business? Most people think any one 
can be a business man. Experience shows that a business man 
must be trained technically and by experience in the principles and 
routine of good business management, and must have in addition 
the personal qualities of a leader, a good trader, plus sufficient 
capital to start a business. 

The profits of a business are in proportion to the business ability 
of the manager; and the salary paid to the manager of a large shoe 
factory or mill is in proportion to his ability to make profits or 
dividends. But while the business may be interested in large 
profits, it is not desirable to achieve this point by raising prices and 
lowering wages, but by improving methods of production, better 
management, increased sales, etc., so as to lower the price of 
wearing apparel or other products. Wages are, and should be, 
highest in the country where the profits are greatest. 

The success of a mill or of a business man engaged in manufac¬ 
turing clothing, etc., is measured by the profit — that is, in a popu¬ 
lar sense, all the earnings above the expenses, and usually calculated 
on a yearly basis or a fraction of a year. In a strict economic or 
technical sense, pure profit is the net return, that is, the receipts 
or gross earnings minus the (a) wages, ( b ) interest, and (c) rent, 
and also minus the ( d ) interest on the proprietor’s capital, (e) the 
manager’s or proprietor’s salary, (/) rental value of the property, 
(g) depreciation of the property and equipment, and ( h ) the reserve 
fund, that is, a sufficient amount to cover possible losses due to 
bad bills, cost of collections, losses, etc. 

Under our competitive system there is no normal rate of profit. 
Some businesses may earn as much in a year as 90 per cent of the 
capital invested, while others may lose 10 per cent of the capital 
invested. 

A reasonable or minimum rate of profit would be the salary that 
the business man or manager would obtain if he were working for 
some one else. But, strictly speaking, such a return is not pure 
profit, since an entrepreneur who manages his own business is en¬ 
titled to such a salary. Likewise, if an entrepreneur uses his own 
land and capital, he is entitled to a fair rent and interest as part of 
the cost of production. 


ACCOUNTING AND COST FINDING 


515 


Pure profit is the return above such items. It does not enter 
into the cost of production, but is a reward for superior organizing 
ability, assumption of risk, etc. 

Expenses. If we examine the routine business of a mill or 
clothing store, we find that the expenses of the business consist of: 
(a) rent; ( b ) initial cost of fixtures and machinery, distributed over 
a period of years, and upkeep of the same; (c) raw material or 
raw cloth, trimmings, etc., that go into the manufactured article; 
( d ) transportation of unfinished and finished goods; (e) wages of the 
employees — workers, clerks, etc.; (/) interest on borrowed money, 
etc. These items are called the expenses of the business. The 
total expenses, subtracted from the gross earnings, give us a sum 
called gross profit. In order to arrive at the net profit, the follow¬ 
ing items must be deducted from the gross profits: (a) capital 
charges, (&) manager’s salary, ( c ) depreciation of stock and equip¬ 
ment, and ( d ) a reserve to cover cost of bad collections, losses, etc. 

Production Costs. The difference between gross income and 
production costs is profit. Frequently the items that enter into 
the production costs and the cost of selling may be reduced. If 
this is done, then the profits are greater. Any reduction in cost 
of materials, labor, overhead, or in selling cost means increased 
profit. 

In other words, it is possible to increase profits either by (a) an 
increase in prices, with costs of production and selling remaining 
the same; or ( b ) by prices remaining constant, with a decrease in 
costs of production or selling, or both. 

Sharp competition in the wearing-apparel industry means low 
prices, which in turn mean small margins between selling and cost 
prices. The only factors that are left for reduction are those 
included in production costs. 

The manufacturer must control the cost of production so as to 
have a difference, or profit, between the cost of manufacturing 
wearing apparel and the price obtained for it in the market. It is 
absolutely necessary for a business man to know every day whether 
he is operating on a profitable basis. This can be done only by a 
proper cost-finding system. 

No business today suffers for want of a proper cost-finding sys¬ 
tem more than the wearing-apparel industry. It is conducted more 


516 ECONOMICS OF CLOTHING AND TEXTILES 


or less on chance, and most producers know the condition of their 
business only when an inventory is taken. 

The record of all business transactions must be kept in all busi¬ 
ness establishments. This record should include : (a) all materials, 
finished, or semi-finished products received or (b) delivered; (c) a 
record of sales, ( d ) of purchases, (e) prices charged, (j) prices paid, 
(i g ) cash received or cash paid, ( In ) credit received or credit given. 

This involves the use of a set of daily record cards on which are 
recorded such items as: (a) raw materials, (6) direct labor employed 
during the different steps of production, and (c) the general expense, 
or overhead, connected with the different processes of production. 
It is essential that the cards should not be too complicated, should 
be arranged in simple sequence, of a size suitable for filing, and 
properly indexed, with all expenditures charged to the proper 
account — that is, the expenditures properly entered. 

Cost-Finding Practices. In the last few years rapid progress 
has been made in cost-finding practices, or the finding of the cost of 
production of an article or commodity. Costs in industry may be 
divided between : (1) commercial, or distribution and selling costs, 
and (2) manufacturing costs. 

The efficient cost accountant is a specially trained financial 
accountant. He should be a master of applied finance in business 
management; his interest is with the technical and commercial 
management, as distinct from a financial accountant, whose interest 
is with credits, banks, balance sheets, etc. 

In the modern cost department, accountancy and management 
meet. It is not too much to say that in the industrial world 
we are watching the evolution of a new science, the rise of a new 
profession. Costs and cost accounting are really a branch of 
management. The cost department reflects in the minutest detail 
all the operations of a business. It has two faces — one toward 
internal works, management (the promotion of economic produc¬ 
tion), the other toward external policy (the foundation for an 
economic price). 

Generally speaking, a company sells not individual processes, 
but finished products, and therefore wants to know the cost of 
production, not only as a check on and guide to selling prices, 
but as a pointer to the most profitable method of doing business. 


ACCOUNTING AND COST FINDING 


517 


This sounds simple; in practice it will be found to be beset on 
every hand with difficulties. Let us look at some of the main ele¬ 
ments of cost in more detail; i.e., the three main elements — 
labor, material, and manufacturing expenses. 

Labor and Material. If we study carefully the transactions 
involved in raising or manufacturing the raw material used in 
wearing apparel, such as raising cotton, wool, silk, rayon, and 
manufacturing them, we find that there are always two definite 
expenses to be charged — materials and labor. Thus in raising 
a raw product we need : seed, fertilizer, etc., for raising cotton and 
linen, food for raising sheep and silkworms, called materials, in 
addition to the care of the ground, sheep, etc., called labor. The 
same is true in manufacturing cloth. There are the raw materials, 
raw cotton, wool, etc., and the labor for assisting in transforming 
the raw materials into finished cloth. 

These two charges — for materials and labor — can be directly 
apportioned among the units of product because they have con¬ 
tributed directly to the amount of production. 

But the fixed charges, such as rent for the land for raising cotton, 
the building used for the manufacturing, tools for cultivating and 
harvesting crops, machinery and power for converting raw mate¬ 
rials, are constant whether production is going on or not. Hence 
they can not be charged directly to each pound of cotton, each yard 
of cloth, etc. They are called overhead charges. 

Overhead Charges. A study of industry shows that it is neces¬ 
sary to have different kinds of laborers. Some work directly on 
the product, operating the machines, etc.; these are employed in 
what is called productive labor, because they are employed directly 
in the production of the wearing apparel or other commodity. 
The superintendent, overseers,. second hands, and other super¬ 
visory workers are included under production. There are others, 
such as engineers, firemen, repair men, janitors, watchmen, etc., 
that are employed in what is called indirect labor. 

The expense or outlay for productive labor is charged to labor 
expense, while all indirect labor is charged to overhead expense. 

The same classification applies to materials. There may be di¬ 
rect and indirect material cost. Direct material cost includes 
those materials used directly in the making of the wearing apparel. 


518 ECONOMICS OF CLOTHING AND TEXTILES 

Materials used in sweeping the floor, coal, lubricating oil, small 
tools, etc., are called indirect materials cost. Direct material cost 
is charged to materials expense, while indirect material cost is 
charged to overhead expense. 

Thus we see that all charges not placed against direct labor or 
direct material are placed against overhead expense. This item 
of overhead expense is a very large one and an important one in 
business. It is known by other names, such as (a) running expense, 
(b) indirect cost. Overhead expense should be carefully analyzed 
and itemized in small divisions, such as (a) rent, ( b ) light, (c) heat, 
(d) power, (e) repair, (f) depreciation, (g) insurance, (h) taxes, 
(i) supplies, (j) interest, ( k ) selling expense, etc. By such an 
analysis it is possible to study each one and see if possibly it may be 
reduced. 

Methods. The introduction of machinery and steam motive 
power revolutionized practically every industry. It also revolu¬ 
tionized and complicated the elements of cost. In the old hand¬ 
working days, raw material and labor covered practically all costs, 
and even after the introduction of machinery, many old-fashioned 
firms never got much farther in their cost finding. The elements 
of machinery and mechanical motive power have been too com¬ 
plicated for them, and they have generally dealt with it in an ex¬ 
ceedingly haphazard manner. 

The old-fashioned way was simply to lump the whole of the 
fixed charges together, take an average at so much per unit, and 
apply it to the price, regardless of the processes through which the 
work passed or the time it took on the way. In some industries 
a percentage of manufacturing costs — wages and materials — was 
taken; in some, a percentage of wages only. 

None of these methods is as accurate, however, as that based 
on a complete departmentalization of the works. This means the 
division of the works into a group of independent shops or de¬ 
partments, such as carding, spinning, etc., and the appropriate 
distribution of standing charges, based on capital values, etc. 
From this there can be compiled a machine cost per hour for every 
process. 

To Estimate Cost of Manufacturing. There are many methods 
used for estimating costs, but the following, as represented on the 


ACCOUNTING AND COST FINDING 


519 


cost sheet, is simple and effective for most cases. There are three 
distinct items on this sheet: 

(a) Direct labor or cost of labor. 

(b) Direct material or cost of material. 

(c) Factory or shop expense or simply overhead charge. 

Direct labor or cost of labor of a job means the total cost of men, 

mechanics, and helpers in doing the work; that is, the amount 
paid out for wages or salaries. The cost of labor for each piece or 
unit of material is determined. 

Direct material or material cost of a job is determined in a similar 
way. 

The factory or shop expense, or simply overhead, is the cost of 
conducting the plant outside of the direct labor and direct material 
involved in the job. It would include the interest, depreciation, 
repairs, supplies, etc., of the following factors: (a) land and build¬ 
ing of plant, ( b ) power plant, (c) lighting, ( d ) heating, ( e ) organiza¬ 
tion, (/) supervisory force, ( g ) storage and transportation. To 
illustrate: If a factory uses $2900 in materials in doing a piece of 
work and the expenses of the factory during this time are $5800, 
it would mean that for every $1 of material used the overhead 
was $2 or twice as much as the material used. Thus the cost of a 
job involving $500 in labor and $400 in materials would be as 


follows: 

Cost of labor. $ 500 

Materials. 400 

Overhead. 800 

Total cost. $1700 


ESTIMATE OF MANUFACTURING. 

Piece Number_ 

Cost of Labor 


Opera¬ 

tion 

Num¬ 

ber 

Operation 

Description 

Ma¬ 

chine 

Used 

Num¬ 
ber of 
Pieces 

Hours 

Me¬ 

chanic 

Hours 

Helper 

Rate 

Me¬ 

chanic 

Rate 

Helper 

Cost of 
Labor 

Cost of 
One 
Piece 

Totals 




































520 ECONOMICS OF CLOTHING AND TEXTILES 


Materials 


Description 

Number 

Length 

Width 

Thick¬ 

ness 

Weight 

Unit 

Cost 

Total 

Cost 

Cost Per 
Piece 

Totals 










Overhead Charges 

—- I I 

Grand Totals_ L 


Average Percentage of Cost in the Men’s Wear Industry 


Average Cost of 

Raw materials. . 
Direct labor.... 
Indirect labor. . . 
Factory expenses 
Administration. . 
Selling. 


Percentage of total 

.49.19 

.27.50 

. 3.73 

. 2.26 

. 3.28 

. 7.93 


Cost of Production 

The proportion of cost of labor and cost of materials in the men’s 
ready-to-wear outer garment industries in the United States. 


Men’s three-piece sack suit: 

Cost of 
labor 

Cost of 
materials 
and 

overhead 

Average quality cheviot. 

.25% 

75% 

Fine clay worsted. 

.21% 

79% 

Low-grade tweed. 

.30% 

70% 

Cheap or medium serge. 

Men’s overcoats: 

.28% 

72% 

Kersey, average quality. 

.25% 

75% 

Fine kersey. 

.22% 

78% 

Cheap beaver. 

.31% 

69% 

Chinchilla (average). 

.23% 

77% 

Melton (average). 

.22% 

78% 


The average percentage cost of the elements in wearing apparel 
production are: materials, 50 to 55 per cent; labor, 30 to 35 per 
cent; and overhead, 15 to 20 per cent. 





































ACCOUNTING AND COST FINDING 


521 


This total cost of a manufactured article of wearing apparel, 
such as a pair of shoes, may be determined as the sum of the follow¬ 
ing costs: 

(a) Direct labor cost, as per the schedule on page 519. 

(b) Direct material cost, as per the schedule on page 520. 

(c) Overhead expenses determined by multiplying the number 
of hours of machine labor by the sum of special and supplementary 
hour rates. 

(d) Administrative expenses, as determined on page 522. 

( e ) Selling expenses, as determined on page 523. 

The cost of manufacturing a single pair of shoes — called the 
manufacturing, or factory, or production cost — is the cost of 
(a) materials, ( b ) labor, (c) factory expense, and ( d ) factory over¬ 
head of each pair. The selling or trading cost of each pair is the 
factory or manufacturing cost plus the additional selling expense 
of a single pair. The total cost of a single pair includes the 
selling or trading cost plus the cost of administration and other 
expenses. 

To illustrate : A pair of shoes is sold to the consumer by a retail 
store for $9.50. The costs may be distributed as follows: 


Per cent of 
factory selling 
price 

Factory labor.$1.37 21.92 

Cost of materials. 2.86 45.76 

Proportional part of 

Insurance and taxes on the factory. .76 12.16 

Proportional part of cost of 

Advertising and selling by the factory .85 13.60 

Proportional part of 

Profit to factory. .41 6.56 

Shoe price at factory.$6.25 100.00 

Selling price 
of retailer 

Price of shoe to retailer. 6.25 65.79 

Proportional part of retailer’s rent.53 5.58 

Proportional part of cost of 

Advertising by retailer.36 3.79 

Proportional part of retail labor 

Sales force, bookkeepers. 1.18 12.42 











522 ECONOMICS OF CLOTHING AND TEXTILES 


Selling price 
of retailer 

Proportional part of cost of 

Management.27 2.84 

Proportional part of cost of 

Light, heat, and freight.19 2.00 

Proportional part of cost of 

Bad debts, repairs, telephone, taxes.. .34 3.58 

Proportional part for 

Profit to retailer. .38 4.00 

Retail selling price.$9.50 100.00 


Depreciation. The loss in value in the manufacturing plant or 
mill is called depreciation and is the result of use. It must be 
considered part of the production cost. The amount of deprecia¬ 
tion is determined by the life of the building, machines, or other 
equipment, minus the junk or residual value. To illustrate: If 
the life of a machine is ten years, we must deduct ten per cent of the 
cost of the machine minus the proportional part of the junk value 
for depreciation each year. 

Apportioning Overhead Costs. One of the most difficult prob¬ 
lems in cost accountancy is the assignment of the proper overhead 
expense charge to each article manufactured. There are many 
different expenses connected with the overhead, and they differ 
more or less in different industries. No standard method will 
apply to all industries and trades. 

Various devices that are at best approximations have been 
attempted in determining the cost of overhead for various parts 
of production ; such as : 

(a) A percentage of the wages, represented by a fraction whose 
denominator is wages and whose numerator is factory costs. 

(5) An hourly rate of overhead is determined by dividing the 
total overhead by the total number of hours of work of direct labor. 

(c) A fraction of the overhead (charged to a department) whose 
numerator is sales of the department and whose denominator is the 
total sales of the factory or store. 

(d) The cost of overhead for each machine is determined by the 
floor-space occupied by the machine, plus allowances for handling 
the material. The ratio of floor-space to total floor-space multiplied 
by total overhead will give department or machine overhead. 







ACCOUNTING AND COST FINDING 


523 


In this case the factory may be considered as being divided into 
a number of departments. Each department may be considered 
as being composed of one machine. 

The method (c) is the most reliable for dry goods and wholesale 
stores, and ( d) is the most effective in factory or mill organiza¬ 
tion. 

In these two methods the overhead expenses are considered as 
of three classes: (1) administrative expense, (2) selling expense, 
(3) the overhead factory expense. To illustrate : If we study the 
organization of a shoe factory, we shall find that it may be divided 
roughly into three sections : (a) administration, ( b ) factory proper, 
(c) selling department. 

The administration section includes the officials and clerical help 
to attend to correspondence, pay rolls, etc. The factory proper 
includes the operation and handling of materials, power, and 
machinery used in the manufacture of shoes. The selling section 
includes the advertising, styling, salesmen, etc. 

The factory cost of a pair of shoes must include the proper addi¬ 
tional expense of each department. 

The cost of administration is determined in relation to the 
factory cost. If a shoe factory has a factory cost of $25,000 and an 
administration cost of $1250 a month, then the cost of adminis¬ 
tration is five per cent of the factory cost. Adding five per cent 
to the factory cost of a pair of shoes would include the cost of 
administration. 

The cost of selling should be added to the factory and adminis¬ 
tration costs. This cost of selling may be determined by the per¬ 
centage of cost of selling to the value of total sales. For example : 
If $15,000 is the cost of selling and the value of shoes sold is 
$300,000, then the cost of selling is about five per cent of the goods 
sold. This five per cent is added to the factory administration cost 
to cover the selling expense. 

Direct Distribution of Overhead. Certain items of factory costs 
may be distributed directly to the different units as follows: 

(a) The rent of a machine is that part of the total rent expressed 
by a fraction whose numerator is the floor-space of the machine and 
the denominator is the total floor-space of the factory. If a 
machine occupies a space of 200 square feet and the total factory 


524 ECONOMICS OF CLOTHING AND TEXTILES 


space is 40,000 square feet and the total rent $800 per month, the 

200 

rent of the machine is $800 X 4 q~qqq or $4 per month. 

(&) Heat, light, and power costs may be determined in a similar 
manner. 

(c) Interest, taxes, and insurance must be calculated in terms of 
a fraction whose numerator is the value of the machine and whose 
denominator is the total value of the plant multiplied by the total 
interest, taxes, and insurance costs. 

(d) Power cost is determined by a fraction whose numerator is 
the horsepower of the machine and whose denominator is the total 
horsepower of the plant multiplied by the total expense of the 
power. 

(e) Depreciation costs consist of the depreciation of the machine 
itself, and the depreciation of the part of the factory where the 
machine is located. The machine depreciation is frequently con¬ 
sidered as 10 per cent of its cost. 

After the correct cost for every step of production has been 
obtained, it is necessary to study the figures to see if any item of 
cost is excessive. If so, the excessive cost should be cut without 
interfering with production or quality of product. 

Regulating Costs. We saw in Chapter VI that the manufacturer 
of a competing product does not determine the price. In case of 
a monopoly the manufacturer can set the price, but otherwise it is 
determined by the above factors in open competition. The market 
price is ordinarily fixed by the costs of the least efficient producer. 
Thus the lower the costs of a manufacturer, the greater his profit. 

Many textile and clothing manufacturers feel that knowledge of 
the actual cost of each step in manufacturing is not necessary or 
important in determining sales policies, because after all the mill 
or manufacturer must sell at prices fixed by competition. This 
attitude explains in many cases the failures of manufacturers, 
because they are producing many articles at a loss and a few at a 
profit. Cost finding would show in detail the exact items that in¬ 
volve a loss and those that are operating at a profit. 

There are many ways in which a plant can regulate costs. For 
example, there are many grades of raw material, varying greatly in 
price. Some of the wool on a sheep’s back may be worth $1 per 



ACCOUNTING AND COST FINDING 


525 


pound, while wool from under the body and on the legs may be 
worth only 10 cents a pound. Therefore, the price of the finished 
commodity or wearing apparel may be regulated by the kind of raw 
material used. Sometimes the cost of raw material may be 
regulated by mixing or blending different grades of wool, cotton, 
etc. 

It is customary in mills to mix different fibers at different prices 
in order to make a product of some intermediate quality or price. 
The process of finding the value of the product is called alligation. 

Rule. — To find the average cost per pound of a mixture, when the 
proportion of the materials mixed and their prices are given, divide the 
total value of the materials mixed by the sum of the amounts put in, and 
the quotient will be the average price per pound. 

A mill man desires to find the average value per pound for the following 
lot of wool: 


218 

lb. at 

81 

cts. per 

lb. 

218 

X 

.81 

= $ 176.58 

413 

lb. at 

79 

cts. per 

lb. 

413 

X 

.79 

= 362.27 

284 

lb. at 

82 

cts. per 

lb. 

284 

X 

.82 

= 232.88 

264 

lb. at 

83 

cts. per 

lb. 

264 

X 

.83 

= 219.12 

18 

lb. at 

103 

cts. per 

lb. 

18 

X 

1.03 

= 19.44 






1197 

lb. 


= $1074.29 


1074.29 -i- 1197 lb. = $0,897, price of mixture per pound. 


The process of finding the quantities of different values required 
to produce a mixture of a given value is called alligation alternate. 

A mill man often desires to find the amount of each kind of wool 
that must be mixed to produce a mixture of a definite amount. 

Example. — How much wool of each kind at respective values of 81, 
85, and 96 cts. must be mixed to produce a mixture of 89 cts. per pound ? 

+ 8X1=8 
+ 4X1 = J 

12 gain 
— 7 X If = 12 loss 

Place the price of the mixture on the left and the prices of the ingre¬ 
dients on the right of the brace. The differences are placed on the right 
of another brace as plus or minus as shown above. The If is obtained by 
showing that the total loss must equal the total gain. Therefore divide 
the 7-cent loss into the total (12-cent) gain to get the quantity loss (If). 


89 





526 ECONOMICS OF CLOTHING AND TEXTILES 


One pound of the first and one of the second will give a gain of 12 over the 
desired mixture; If lb. of the third wilf make up the difference of 12. 

One pound of the first, one of the second, and If pounds of the third 
will give the desired mixture. 

Example. — A manufacturer has on hand 432 lb. of wool of a value of 
94 cts. which he desires to use in producing a lot worth 82 cts. per lb. He 
has a large lot of a cheaper grade of wool (2587 lb. worth 75 cts.). How 
much of this cheaper grade must be used to produce a mixture worth 
82 cts. per pound ? 

f 94 1 - 12 X 432 = 5184 loss 
82 \ 

[ 75 J + 7 X 740f = 5184 gain 

Similarly the 7-cent gain is divided into the total loss (5184) to obtain 
the quantity required (740f lb.). 

He should mix 432 lb. of 94 cts. and 740f lb. of 75 cts. wool in order to 
produce a mixture of 82 cts. 

Proof. — 94 X 432 lb. = $406.08 
75 X 740f lb. = 555.42f 
1172f lb. = $961.50? 

1 lb. = 82 cts. 

A Cost System Has Two Functions. A satisfactory cost system 
in a textile mill serves two functions. First, it should reveal the 
normal cost of each separate style or pattern of goods or count of 
yarn which the mill sells, and it should be so devised as to enable 
the management to predict with reasonable accuracy the cost in 
its mill of any style or yarn not previously made. Second, the 
records and reports regarding pay rolls, production, waste, etc., 
which are kept for the purpose of maintaining the cost system 
should be so designed that they will provide valuable informa¬ 
tion for the operating executives — that is, the superintendents 
and overseers. Both of these main purposes of the cost system 
concern the operating executives very closely. 

The most important function of a satisfactory cost system is the 
development of normal costs on each yarn and fabric made, and of 
pre-determined costs on those styles or yarns proposed. By normal 
cost is meant the cost which the mill will actually attain under nor¬ 
mal conditions, with unusual or special circumstances eliminated. 
That is, a cost that will reflect truly and equitably the natural 




ACCOUNTING AND COST FINDING 


527 


differences in manufacturing procedure which will be encountered 
in manufacturing any two or more yarns or fabrics. Such figures 
are principally of importance for sales purposes, and when correctly 
developed, they will point the way accurately to the fabrics on which 
the mill can achieve the best results, and to the prices in each 
case which the mill must obtain in order to show a profit from its 
manufacturing activities. The intelligent use, by a skilled manage¬ 
ment, of such data in connection with its selling policies will have 
a direct effect upon the profits of the mill, even in such difficult 
times as a depression. 

Such pre-determined normal cost figures should reflect every 
important distinction in processing different rovings, yarns, or 
fabrics in the mill; they should include all overhead charges; 
they should allow for waste credits; and should reflect certain 
features of management policy. Among the latter, these costs 
should include ample depreciation, based not on the cost of the 
plant, but on what it would cost to replace it, and they should also 
include an allowance for a reasonable return on the capital that 
the mill has invested in its plant and in normal inventories. These 
figures should be so designed as to take account of the normal 
amount of curtailment which the mill is likely to experience in the 
future as indicated by its past records over a long period of time. 
For quotation purposes the cotton, wool, or silk costs should 
represent replacement value. 

As several of the items mentioned do not in any way correspond 
to records on the general books, we do not advocate that the cost 
system should be tied in with the bookkeeping records. A quar¬ 
terly check-up of reconciliation of these normal cost figures against 
actual expenditures is desirable, and, as often as indicated by the 
results of this check-up, the original cost figures should be revised. 

To support this periodical check-up, careful reports should be 
made from each department and summarized in the records. They 
should include, among other information, such items as the pounds 
of each style woven, the looms operated on each style, and the 
pounds of each kind of waste made. Such information reported 
weekly from the various departments should be tabulated in the 
office in such a way that the superintendent and other officials can 
see at a glance just how the performance of any department for 


528 ECONOMICS OF CLOTHING AND TEXTILES 


any week compares with its performance during previous weeks and 
with the budget figures used originally in developing the cost data. 
Such records should also include a weekly pay-roll analysis, showing 
the amount of money spent for each kind of occupation in the mill, 
each figure being shown in the same column with the budgeted 
amount at the top of the column. The superintendent and over¬ 
seers by examination of such records can immediately see the 
trend of any particular detail of production, operation, or pay roll, 
and promptly remedy any undesirable situation. 

Such reports for any week require but a short time for their 
preparation, and should be available promptly for the inspection 
of every one concerned. The operating executives should have 
before them at all times definite records showing the trend of their 
pay-roll expenditures, their operations, their production, and their 
waste. Many mills also keep records of repair and supply expen¬ 
ditures by departments, and these again can be tabulated as 
described. In addition to having the trend of these items visibly 
displayed, they are also shown in comparison with the budgeted 
figures on which the original costs were based. There are numerous 
cases where such pay-roll tabulations alone have resulted in savings 
of hundreds of dollars per week. 

Such a method, which is easily maintained, requiring only a 
fraction of a man's time in any ordinary mill, provides figures of 
infinite value for selling purposes, together with data which enable 
the superintendent and overseers to know accurately at all times 
the performance of the various departments. In the latter respect 
it has the further virtue of promptness of information, enabling 
undesirable situations to be corrected as soon as they develop. 

Many mills originally used a type of cost system which was devel¬ 
oped principally by agencies whose experience had been chiefly in 
other industries. This other type of cost system proposes to 
refigure periodically — in some cases once a week, in other cases 
once a month—a so-called actual cost for each product of the mill. 
Any one thoroughly familiar with all the details involved in cotton 
manufacturing must realize that, in a mill of even moderate variety, 
a computation of the cost of each product of the mill for a given 
specified period must involve a tremendous amount of detail if it 
is to be accurate. The only way to avoid such a vast amount 


ACCOUNTING AND COST FINDING 


529 


of computation is to employ short-cut methods, which will result 
in misleading the mill as to the cost relations between different 
fabrics. This type of cost system is generally tied in with the book¬ 
keeping system, which again adds to the complication of the method 
and impairs its flexibility. 

There is no particular value in having these so-called actual 
figures on each style available periodically, because even if they 
indicate that an undesirable condition has obtained during the 
period in question, the mere statement, let us say, that the cost of 
30’s warp is \ cent per pound higher than the previous month 
is meaningless to the operating executive until he has gone back 
and analyzed these figures to determine whether that increase in 
cost was due to pay-roll increases, to a falling-off in production 
per spindle, to curtailment, to an unusual expenditure for supplies, 
or what not. 

Yarn Costs. The following yarn cost sheet shows how com¬ 
plicated it may be to establish costs. It is necessary to con¬ 
sider the size or the fineness of yarn, as explained later, on page 
531. 

The yarn is shipped in different containers, such as cones for 
knitting machines, etc., as explained in the author’s book on 
Textiles , page 221. The kind and quality of cotton is expressed 
according to the classification described on page 216. 

The cotton fibers are made into yarn by a process of drawing and 
twisting. The twisting is expressed as the number of turns or 
twists per inch. The more twists in the yarn the more strength is 
provided. A yarn with a small amount of twist is generally soft, 
pliable, and elastic, and is valuable for hosiery. The amount of 
twist varies with the yarn and use. Thus yarn used in the warp 
of the cloth has more twist than that used in the filling. 

The capacity of a spinning machine is expressed by the number 
of spindles (part that holds the container of yarn). In fact, the 
capacity or size of a mill as well as the cost of a mill is expressed in 
product per spindle, cost per spindle, etc. 

Materials like cotton, silk, and wool are bought in the raw 
condition by the pound. When they are made into a thread or yarn, 
the size is expressed in numbers. The sizes are based on the rela¬ 
tion between weight and length. 


YARN COST CARD 

Showing the cost of manufacturing single ply cotton yam 8’s on a cone. 
Yarn — No. or size 


530 


ECONOMICS OF CLOTHING AND TEXTILES 


if 

f I 


R h g 

os <u tS 
aag 

m oo-^ 

531 


§ s s 

HHH 


a a.® 

S3 8 


fts.S 

S3 § 


•3.1^ 

O20£ 


b- CO 

S3 

<M 1-H 

oo 


t^O© OO^NCOCONOffiOJ 
oot^oo 

T-<oot> co b- a> © o o os co us ■<# 

8 00 CO t~- CO lO O *0 T* t" © 00 

OO OrtNNONONOlN 


h R k R 


aaaaaaaaaaaa 

OQaQOQOQOQQDOQQQ 

oooooooo 
OOOOOOOO 


o o o 
OOO 


M.S. 


•h 5 O ® ® ® S P 4 ’^ ^ ^ 

C3 q• i-Q j o o*St o 


*3 ® CD S O 

a So § >>.2 

•*S&g Q 

■S ft ab '3/s 


*s|§l 

^Igg-Sg-i-aig 

SgSSgS|||§ 
03 J S 2o 

OOOOOOO o3 »-< 

HOHHh-}HO HO 


1 Subject to income-return on investment less than 6%. 


























































ACCOUNTING AND COST FINDING 


531 


To illustrate : 

Worsted yarns are 
made from combed 
wools, and the size, 
technically called the 
counts , is based upon 
the number of lengths 
(called hanks ) of 560 
yards required to 
weigh one pound. 

Thus, if one hank 
weighs one pound, 
the yarn will be num¬ 
ber one counts, while 
if 20 hanks are re¬ 
quired for one pound, grains or one seventy-thousandth part of one 
the yarn is the 20’s P oun( ^ avoirdupois, rendering them well adapted 
^ , , ’ for use in connection with yarn reels, for the 

etc. I he greater the numbering 0 f yarn from the weight of hank, giving 
number of hanks the weight in tenths of grains to compare with 
necessary to weigh tables, 
one pound, the higher 

the counts and the finer the yarn. The hank, or 560 yards, is the 
unit of measurement for all worsted yarns. 


Length for Worsted Yarns 


No. 

Yards 
per Lb. 

No. 

Yards 
per Lb. 

No. 

Yards 
per Lb. 

No. 

Yards 
per Lb. 

1 

560 

5 

2800 

9 

5040 

13 

7280 

2 

1120 

6 

3360 

10 

5600 

14 

7840 

3 

1680 

7 

3920 

11 

6160 

15 

8400 

4 

2240 

8 

4480 

12 

6720 

16 

8960 


Woolen Yarns. In worsted yarns the fibers lie parallel to each 
other, while in woolen yarns the fibers are entangled. This differ¬ 
ence is due entirely to the different methods used in working up the 
raw stock. In woolen yarns there is a great diversity of systems 
of grading, varying according to the district in which the grading 
is done. Among the many systems are the English skein , which 



Roving or Yarn Scales 
These scales will weigh one pound by tenths of 






















532 ECONOMICS OF CLOTHING AND TEXTILES 


differs in various parts 
of England; the Scotch 
spyndle; the American 
run; the Philadelphia 
cut; and others. In 
this book the run sys¬ 
tem will be used unless 
otherwise stated. This 
is the system used in 
New England. The 
run is based upon 100 
yards per ounce, or 
1600 yards to the 
pound. Thus, if 100 
yards of woolen yarn 
weigh one ounce, or if 
1600 yards weigh one pound, it is technically termed a No. 1 run; 
and if 300 yards weigh one ounce, or 4800 yards weigh one pound, 
the size will be No. 3 run. The finer the yarn, or the greater the 
number of yards necessary to weigh one pound, the higher the run. 


Length for Woolen Yarns (Run System) 


No. 

Yards 
per Lb. 

No. 

Yards 
per Lb. 

No. 

Yards 
per Lb. 

No. 

Yards 
per Lb. 

•g- 

200 

1 

1600 

2 

3200 

3 

4800 

4 

400 

14 

2000 

24 

3600 

34 

5200 

4 

800 

n 

2400 

24 

4000 

3^ 

5600 

f 

1200 

if 

2800 

2f 

4400 




Raw Silk Yarns. For raw silk yarns the table of weights is: 

16 drams = 1 ounce 
16 ounces = 1 pound 
256 drams = 1 pound 

The unit of measure for raw silk is 256,000 yards per pound. 
Thus, if 1000 yards — one skein — of raw silk weigh one dram, 
or if 256,000 yards weigh one pound, it is known as 1-dram silk, 
and if 1000 yards weigh two drams, the yarn is called 2-dram silk ; 
hence the following table is made : 



Yarn Reel 

For reeling and measuring lengths of cotton, 
woolen, and worsted yarns. 
























ACCOUNTING AND COST FINDING 


533 


1- dram silk = 1000 yards per dram, or 256,000 yards per pound 

2- dram silk = 1000 yards per 2 drams, or 128,000 yards per pound 
4-dram silk = 1000 yards per 4 drams, or 64,000 yards per pound 


Drams per 

1000 Yards 

Yards per Pound 

Yards per Ounce 

1 

256,000 

204,800 

16,000 

4 

12,800 

? 

4 

? 

4 

146,286 

9143 

2 

128,000 

8000 

2 i 

113,777 

7111 

2* 

102,400 

6400 

2f 

93,091 

5818 

3 

? 

? 

34 

78,769 

4923 

34 

73,143 

4571 


Place the missing yards in the space marked. 

Silk yarn is often numbered by a metric system of weight and 
length. The weight unit is the denier — .05 gram. The length 
unit is the meter. The number of deniers equal in weight to 450 
meters is called the size of the yarn. To illustrate : If 450 meters 
of silk is weighed and found to weigh .8 gram, then the size of the 

g 

yarn is or 16 deniers. The silk may vary in fineness by two 
.Uo 

deniers, hence the size is written 16/18. 

Linen Yarns. The sizes of linen yarns are based on the lea 
or cuts per pound and the pounds per spindle. A cut is 300 yards 
and a spindle 14,000 yards. A continuous thread of several cuts 
is a hank, as a 10-cut hank, which is 10 X 300 = 3000 yards per 
hank. The number of cuts per pound, or the leas, is the number of 
the yarn, as 30’s, indicating 30 X 300 = 9000 yards per pound. 
Eight-pound yarn means that a spindle weighs 8 pounds or that 
the yarn is 6-lea (14,400 -5- 8) -5- 300 = 6. 

Cotton Yarns. The sizes of cotton yarns are based upon the 
system of 840 yards to 1 hank. That is, 840 yards of cotton yarn 
weighing 1 pound is called No. 1 counts. 

Spun Silk. Spun silk yarns are graded on the same basis as that 
used for cotton (840 yards per pound), and the rules and calcu¬ 
lations that apply to cotton apply also to spun silk yarns. 









534 ECONOMICS OF CLOTHING AND TEXTILES 


Two or More Ply Yarns. Yarns are frequently produced in two 
or more ply; that is, two or more individual threads are twisted 
together, making a double twist yarn. In this case the size is 
given as follows: 

2/30’s means 2 threads of 30’s counts twisted together, and 3/30’s 
would mean 3 threads, each a 30’s counts, twisted together. 

Diagrams, Charts, and Graphs. Diagrams, charts, and graphs 
are very useful in accountancy, in making comparisons, showing 
progress of departments, sales, etc., as described on page 19. 

Sales Expressed Graphically. By means of graphs, increases or 
decreases in commodity sales may be noted. A total of 338,000,000 



yards of cotton cloth was sold by the mills in January, 1932, as com¬ 
pared with 289,000,000 yards in January, 1931 — a gain of 17 per 
cent. The cotton textile industry has shown a relatively high level 
of production and sales in recent months, indicating a definite 
improvement in activity, although low price levels remain. 

Shipments from the mills were 27 per cent heavier in January of 
1932 and cotton cloth production was 15 per cent above the same 
month of 1931. The graph for 1931 and 1932 shows increased 
production and sales of textiles contrasted sharply with most other 
basic industries, which were generally showing restricted output. 














































ACCOUNTING AND COST FINDING 


535 


Stock Records. The use of continuous stock records will enable 
a company to know at any time the status of the business. Such 
records provide a constant inventory of incoming and outgoing 
stock, thus forming a perpetual inventory record. See page 539 
for a record card. 

The requirements of a good stock record demand a maximum 
amount of information with the minimum amount of labor. An 
adequate record should show (1) the articles on hand with proper 
serial and register numbers, (2) the lot number, (3) description of 
the article, such as size, color, and other characteristics for identi¬ 
fication, (4) cost, (5) quantity received, (6) quantity remaining 
(by subtracting the amount sold). 

It is very desirable to know how fast the article is sold so that 
the good sellers may be known from the poor sellers. Additional 
information may be added to the stock record stating (1) when the 
article was received, (2) when it was sold, (3) mark-up price ex¬ 
pressed in percentage, (4) mark-down price expressed in percentage, 
(5) number of returns or cancellations. In addition, the sources 
of information should be recorded, such as obtained from (a) order, 



Graph of Price Trend 

















536 ECONOMICS OF CLOTHING AND TEXTILES 


WORTH ST. CONVERTERS Packing Order No. 66 
40 Worth St. 

New York City Date July 10th, 1934 

Packing Order and Shipping Instructions: 

To U. S. Finishing Go. Providence, R. I. 

Quality Crescent From Lot No. 501 

m , ,, . „ Doubled and Rolled 

Take all pcs. each 35/40 yds. per pc. Put up Papers 

Pack into 6 of 50 pcs. each, lined with Manila Pape 


These Goods Must Be Invoiced Latest 

Stamping and Ticketing Instructions 

July 25th 

Crescent Ticket 

Assortment for each case 

Hang Tag 

10 pieces of each color 

with color No. and yds. 

Assortment : Packages always to be propor¬ 
tionately assorted unless otherwise specified. 

Use Package Numbers: 100/105 

Sample Requirements : Important Fill these before invoicing and ship at once. 

12 Headends ticketed as goods 


Standard Instructions : State cubic dimensions, net, legal and gross weight on 
invoices. 

This is important. Invoices without this information are useless to us so do 
not send them in incomplete. We require invoices in triplicate. 

Shipping Instructions : When ready, invoice and ship as below. 

Ship via Freight 


To N. Y. 







ACCOUNTING AND COST FINDING 


537 


WORTH ST. CONVERTERS Lot No. 501 

40 Worth St. 

New York City New York, duly 5, 1934 

To U. S. Finishing Co. Providence, R. I. 

Finish the following goods as per instructions below. Total Bales 4 
Shipped from King Phillip Cotton Mills, Fall River 
Grey Construction 40" 60x56 Voile Total Pieces, 219 

Hard Twist Total Yards 11973 

Send Sample Gut from Grey Goods. 


Lot Bale Yards Yellow Style 

46750 AI00/ 11973 101 Crescent 

/103 


Finished Width 59/40" _ 

Finish 

Mercerised Voile Finish 
(As Sample Attached) 


2000 yards white 


2000 

3000 

3000 

2000 


' ’ Lt. Pink #2 
* ? Medium Green #5 
' ' Navy #7 
' » Black 


Put up Cut into lengths of 35/40 yds 

Fold Douhled and Rolled 

Stamping or Ticketing See Packing orders 
Papering Blue 

No boards wanted in pieces Thi ck Card Boards to go in each piece 

Approval Send us a headend showing finish and ticketing and stamping for 
approval before proceeding with lot. Also M yd. reference of each color 
or printed combination. The entire lot must be finished, ticketed and 
stamped exactly as in headend or reference approved by us. 

Reference samples must be mailed 2J/. hours after our approval. 

Samples Please send us 

Packing Use lumber for cases, and 103^ to 12 oz. burlap for bales. 
Shipping Instructions To follow 

Weights Exact gross and net weights and measurements must be stated on 
invoice. 

Legal weight also wanted whenever goods contain boards and are 
papered. 

Seconds Please write for instructions as regards stamping, packing, etc. 

WORTH ST. CONVERTERS 

No marks, numbers or labels except our own are to 

appear on goods or packages, unless otherwise instructed. ” er d • xl . 






COST ITEMS FOR INDIVIDUAL LOTS OF GREY GOODS PROCESSED 


538 


ECONOMICS OF CLOTHING AND TEXTILES 



Loss 295 yd. 4% 

forking Loss Allowed 2 % 239 yd. 

Charge to Finisher. 56 yd. $ 2.80 






























































Quality 1U GREY GOODS STOCK RECORD 

Width Description Poplin 


ACCOUNTING AND COST FINDING 


539 


3% 

M a 


-a o 


3^ 
o . 

A 6 
r ao 


<to to co co 

frN. ^ 


& ® 


iil= 

Q 0^1? 


OOCoCo 

OIOJSNOOOO 
CO Co 05 05 05 

<5* Co CO 

S0S0G0&9*O l O l C> , O 


9 $£ 

O a£ 


Bq ^ ^ 
O O J 


■S-S 

co CO 


£ *C ° ^ ^ ‘so 

'S'S|Iesee 

O O kJ kJ cq cq oq cq 




05 O C35 Oo 

0050005000 ) 
io vhq *o '4-uj >o -*t- 

©l®4©}i30©l l 34®l®i 


©} ©J 90 SO GO '<*"<}-'■ 
sososoeosoeosos 
^— «t —=(— «t— — 


O 03^ 






0505050505050505 


00000000 

<9} >9} < 


Quality 144 Width 37 -z Description Poplin 









































540 ECONOMICS OF CLOTHING AND TEXTILES 


QUESTIONS 

1. Why is the subject of accounting and cost finding important to 
the textile and clothing manufacturer ? 

2. How is the subject of accounting and cost finding related to the 
subject of economics of clothing? 

3 . Explain in detail, with examples, the difference between ( a ) ac¬ 
counting, ( b ) bookkeeping, (c) cost accounting. 

4 . (a) Describe the purpose of an invoice. ( b ) Explain the essential 
points of an invoice. 

5 . What is meant by the expression “open account”? 

6. (a) What is the purpose of a ledger? (6) Explain the theory of 
ledger accounts. 

7. How may the correctness of accounts be quickly checked ? 

8. Explain the difference between trial balance and balance sheet. 

9 . In the statement of a mill, what is meant by the terms : (a) assets, 

( b ) liabilities, (c) inventory? 

10. Explain the meaning and importance of (a) profit, ( b ) loss, (c) net 
or prime cost, ( d ) gross or full cost, (e) gross selling price, (/) net selling 
price. 

11. (o) Name the factors that determine the success of a business 
man. (6) How is the success of a business man usually expressed ? 

12. (a) What is meant by the expression “expenses of business”? 

( b ) Name some of the items included under expenses. 

13 . How may a textile manufacturer or clothing manufacturer increase 
his profits? 

14 . How may production costs be determined ? 

15 . What is meant by the expression “cost finding practices”? 

16 . Explain in detail the terms: (a) labor, ( b ) material, (c) overhead 
charges. 

17 . Explain some of the methods of computing overhead charges. 

18 . Give briefly the outline of estimating the cost of manufacturing. 

19 . What are the average percentage costs of the (a) material element, 
(6) labor element, (c) overhead element in clothing and textiles ? 

20. Explain how the total cost of manufactured wearing apparel, i.e., a 
pair of shoes, may be determined. 

21. Explain different methods of apportioning overhead, with illustra¬ 
tions. 

22. (a) What is meant by the expression “direct distribution, over¬ 
head”? ( b ) How may it be computed ? 

23 . How may a manufacturer regulate costs in clothing and textiles? 

24 . What is meant by alligation? Give an example. 


ACCOUNTING AND COST FINDING 541 


25 . Why is yarn cost a rather difficult part of textile manufacturing? 

26 . How is the size of yarn computed? 

27 . Give briefly a method of cost finding in cotton yarn. 

PROBLEMS 


A. Find per cent of gain or loss : 



Cost 

Gain 

Cost 

Loss 

1 . 

$1660 

$175 

6. $6110 

$112 

2 . 

$1845 

$135 

7 . $5880 

$ 65 

3 . 

$1997.75 

$412.50 

8. $3181.10 

$108.75 

4 . 

$2222.50 

$319.75 

9. $7181.49 

$213.60 

5 . 

$3880.11 

$610.03 

10 . $3333.19 

$ 28.90 


B. Find the per cent gain or loss on both cost and selling price: 



Cost 

Selling Price 

Cost 

Selling Price 

1 . 

$1200 

$1500 

6 . $2475 

$2360 

2 . 

$1670 

$1975 

7 . $1650 

$1490 

3 . 

$2325 

$2980 

8. $4111.50 

$2880.80 

4 . 

$4250.50 

$5875.75 

9 . $4335.50 

$4660.60 

5 . 

$3888.80 

$4371.71 

10 . $2880.17 

$2551.60 

Example 1 . 

An article costs $5 and sells for $6. 

What is the percent- 


age of profit? Ans. 16#%. 

Process. Six dollars minus $5 leaves $1, the profit. One dollar divided by 
$6, decimally, gives the correct answer, 16f%. 

Example 2. A dealer sold tools at a profit of $98. What was the cost 
of the tools, if he sold to gain 35% ? 

Formulas 


Gain or loss = Cost X rate of gain or loss 
_ _ Gain or loss _ 

Rate of gain or rate of loss 

Selling Price = Cost {100% + rate of gain) or {100% — rate of loss) 
Q os t _ Selling Price ^ Selling Price 

100% + rate of gain 100% — rate of loss 
C. Find the selling price in each of the following problems: 


Sold to Lose 

Cost 

1 . 

16#% 

$96 

2 . 

20% 

$115 

3 . 

30% 

$48 

4 . 

19% 

$112.50 

5 . 

m% 

$187.75 


Sold to Gain 

Cost 

6 . 

37% 

$250 

7 . 

33% 

$644.50 

8 . 

41% 

$841.75 

9 . 

29% 

$108.19 

10 . 

22|% 

$237.75 





542 ECONOMICS OF CLOTHING AND TEXTILES 


D. What is the percentage of profit, if an article costs $8.50 and sells 
for $10? 

Solve the following examples by the table on page 513. 

1. I bought a machine for $584 f.o.b. New York City. Freight cost 
$1.05. I desire to sell to gain 8%. If the cost to do business is 18%, 
what should be the selling price ? 

2. Goods were sold for $367.75 at a loss of $125. Find the cost of the 
goods. 

3 . Goods costing $145.25 were sold at a profit of $28.50. For how 
much were they sold ? 

4 . A manufacturer bought 4£ yards of silk at $1.80 per yard, and gave 
in payment a $10 bill. What change did she receive? 


CHAPTER XIII 


THE BUSINESS CYCLE 

Definition. We all know that business is subject to more or less 
regular “ups and downs/’ and does not move along on a general 
level of activity. A period of prosperity or “good times” is 
followed by a period of depression or “hard times.” A period of 
slow recovery may then merge into another period of prosperity. 
Such rhythmic movements in the rise and fall of business activity 
are called business cycles. These changes in business events seem 
to follow each other in a definite sequence, and to recur at more or 
less regular intervals. 

Some economists have declared such fluctuations appear once 
every ten years. Other economists deny any such regularity in 
the occurrence of the cycle, but recognize that such “ups and 
downs” have recurred at intervals ever since the development of 
business on a large scale — within the past century or more. 

Types of Depression. Business depressions may be of two types : 
general and special. General depressions are those affecting all 
business activity, while special depressions are usually restricted 
to one industry and have their cause in some particular condition 
pertaining to that industry. The general depression is usually 
world-wide in its effects, and brings general hard times. It is the 
type of depression that marks the falling motion of the business 
cycle. 

The depression period of the cycle may be slight and of short 
duration, or it may be severe, even reaching the proportions of a 
panic. A panic represents a profound distrust of banking and 
credit structures, and results in unreasonable actions by a few or 
many persons in trying to salvage their own interests regardless of 
the welfare of others. Thus runs on banks, hoarding, etc., char¬ 
acterize a panic. A depression is not necessarily a panic, although 
panics do sometimes occur during depression periods. Some of the 
depressions in the United States have been called 
543 


more severe 


544 ECONOMICS OF CLOTHING AND TEXTILES 

panics. Severe business depressions have taken place in the 
United States in the years 1837, 1857,1893, 1920, and 1929. Less 
severe depressions, or “bad times ,” have occurred also in 1814, 
1825, 1847, 1865, 1884, 1901, 1907, and 1914. 

The regular descending movement of prices and business activity 
occurring in the course of the business cycle may be aggravated or 
complicated by some outside condition. Thus the depression of 
1929-1932 is unlike many of those preceding it, because it is in 
many respects due to the results of the World War and the treaties 
that ended it. The attempt to pay war reparations and inter¬ 
governmental war debts, and the erection of tariff walls as barriers 
to foreign trade have been contributing causes to the depression. 
The World War, in addition, represented the destruction of a phe¬ 
nomenal proportion of the wealth of the world, as well as disrupting 
the whole social, economic, and political foundations of the nations 
involved. The destruction of capital goods was of such vast propor¬ 
tions that it has taken half a generation for the world to recover. 
There are some who say that the reconstruction and replacement 
of such destroyed wealth offered employment to workers, but they 
fail to recognize that the labor and capital consumed in the War 
might have been employed to give greater benefits to society. The 
unparalleled expansion of business and productive activity in the 
United States that followed recovery was abruptly ended in the 
crisis of 1929 and the depression period that followed. 

Stages of the Business Cycle. Four general stages in the devel¬ 
opment of the business cycle have been generally recognized by 
economists. Once begun, these phases seem to follow each other in 
logical sequence, each new phase having its origin in the develop¬ 
ments of the preceding one. Thus we have: (a) the period of 
prosperity, (b) the period of crisis, (c) the period of depression, 
and (d) the period of recovery. Economists are generally agreed 
that business cycles do not generally follow immediately one after 
the other, but are usually separated by periods of more or less 
settled activity. The causes leading up to a new cycle are not 
fully established. Economists differ in their explanations and no 
one satisfactory theory has emerged. Some of the suggested 
theories will be described after we have completed the analysis of 
the various stages in the cycle. 


THE BUSINESS CYCLE 


545 


The Period of Prosperity. The discussion of the business cycle 
ordinarily starts with the period of prosperity, when business 
activities are at a high peak, prices are rising, labor is in demand 
and is being paid high wages, business men are receiving large profits 
and are borrowing money and expanding their operations in order to 
supply the increased demand for products. A spirit of optimism 
prevails, stock market prices go up, and we have what is called 
“boom times.” Such a condition existed in the clothing industry 
during the World War when the manufacturers were receiving higher 
prices than they had ever expected, consumer demands for clothing be¬ 
came greater and greater, errand boys and apprentices earned as high 
as $25 a week, and workmen earned as high as $100 a week. The 
laboring classes and clerks were able to wear silk shirts and dresses, 
and every one was enjoying an unprecedented wave of prosperity. 

The question may be asked as to why such a period of prosperity, 
once begun, does not continue indefinitely. If we made a careful 
analysis of the clothing industry, we should find that the very 
elements that contribute to high profits in the beginning of a period 
of prosperity are exactly the elements that cause business costs to 
become higher than selling prices and in turn bring about the crisis 
leading to depression. 

Let us consider the steps as they occur: 

(a) Increased demand causes a gradual rise of prices, spreading 
from one commodity to a constantly greater number. 

( b ) The fixed expenses of business (see page 517) do not increase 
as fast as prices for the manufactured products, so that the business 
man finds his profits increasing. 

(c) The rise in prices spreads gradually to raw materials, etc., 
hence the costs of business also go up. 

(d) Wages and employment increase, there is overtime work, and 
the costs of business go still higher. 

(e) Management becomes careless and inefficient because of the 
easy profits. 

(/) Labor becomes more independent and less efficient because 
the demand for labor is greater than the supply, and keeping one’s 
job is not so important. 

(g) Because of increased loans for business expansion interest 
rates rise. 


546 ECONOMICS OF CLOTHING AND TEXTILES 


(h) As the costs of production go up we find that raw materials, 
labor, capital charges, etc., rise faster than the price of the finished 
product. 

(i) Manufacturers find themselves with an increasing supply of 
goods that they are unable to dispose of at the higher prices. 

( j ) Prices of stocks, etc., fall as the speculators realize that mar¬ 
ginal profits are decreasing. 

(k) Bank reserves are lower and loans are not granted as freely 
as before. 

(l) Trade papers, banking information sheets, and newspapers 
begin to comment on the shrinkage of business, the excess produc¬ 
tion, etc. 

(m) Pessimism begins to replace the enthusiasm of the boom 
period and goods are dumped on the market for what they will 
bring. Paper profits become losses. 

The period of prosperity ends and we now have the period of 
crisis, resulting from the same forces that produced prosperity. 

The Period of Crisis. The period of crisis is marked by a rapid 
liquidation process. That is, instead of producing more and buying 
more, every one is anxious to dispose of his surplus product and to 
produce as little as possible. Manufacturers try to dispose of their 
products even at low prices in order to meet their loans. Banks 
call their loans, stocks and bonds fall further in price. Factories 
are shut down, causing much unemployment and consequent loss 
of purchasing power. Business failures and bankruptcies increase. 
Because of the credit connections of one business with another one 
bankruptcy may cause several other business failures. It is during 
this period of rapid liquidation that panics sometimes occur. The 
inelasticity of credit resources to meet the demand caused many of 
these panics. The organization of the Federal Reserve system has 
done much to overcome this difficulty and to prevent the develop¬ 
ment of panic conditions. The period of crisis, which is ordinarily 
short, gradually gives way to a more leisurely decline or liquidation 
and the period of depression begins. 

The Period of Depression. The depression period may last only 
a short time, giving way almost immediately to an immediate recov¬ 
ery, or it may last for a period of years. During this time business 
is at a practical standstill and “hard times” prevail. Production 


THE BUSINESS CYCLE 


547 


is cut down to a minimum; there is much unemployment; and 
consumer demand is accordingly at a low point. Prices continue 
to decline, but not as rapidly as before. A spirit of pessimism 
prevails, and no one is willing to launch a new enterprise. Profits 
are at a minimum. 

At the same time, certain other developments are taking place 
that will pave the way for recovery. Just as the boom period 
carries along with it certain checks to prosperity, so the depression 
period witnesses certain readjustments that make for new prosper¬ 
ity. Thus, the process of liquidation brings about a decline in the 
costs of production as well as in prices. Raw materials fall in 
price, wages decline greatly because of unemployment, labor 
becomes more efficient and less restless, management eliminates 
wasteful processes for the sake of economy, bank reserves increase 
and the interest rate declines because of the decrease in the demand 
for loans. In other words, many of the readjustments necessary 
for recovery have been made and the period of recovery 
begins. 

The Period of Recovery. During the depression period produc¬ 
tion has been greatly curtailed, and the surplus commodities have 
been gradually consumed. Retail stocks are gradually sold out and 
it becomes necessary for retailers to replenish their supply. The 
demand for goods gradually causes factories to renew production 
activity. The low interest rates and the willingness of banks to 
make loans cause certain producers to take advantage of them and 
expand their activities. Meanwhile speculators, sensing this 
revival of business activity, have by bidding caused the price of 
stocks to rise, thus lending encouragement to producers. Timidity 
and pessimism gradually give way to optimism, and we find busi¬ 
ness improving, prices going up, and employment increasing. The 
business cycle has completed its course and is ready once more 
for the beginning of a new period of prosperity. 

Theories to Explain the Business Cycle. The Sunspot Theory. 
One of the many theories that have been advanced to explain the 
recurrence of the business cycle is the sunspot theory. That is, 
certain spots that appear periodically on the sun affect the climate 
of the earth, which in turn affects the agricultural production. 
Because of the importance of agriculture to industry, it is believed 


548 ECONOMICS OF CLOTHING AND TEXTILES 


that any great change in the output of crops will so upset the 
normal equilibrium of prices that a new business cycle may be set 
in motion. This theory is not accepted by scientists or economists, 
however, as an adequate explanation of the rhythmic change in 
business activity. 

It is true that abnormal weather can have a great effect on 
certain industries, particularly on the clothing and wearing apparel 
industry. Clothing and wearing apparel products are planned and 
manufactured on the basis of normal weather at the proper season. 
This means, in the United States, a cold dry winter with ice and 
snow from about December 15 to March 15, a gradual development 
of warmer weather, with much rain, to June 15, then the hot season 
from June 15 to September 15, when fall sets in with the return of 
frost during the night and the changing of the foliage. It is 
impossible to state the exact date when these changes of season take 
place, but they are approximately three months in length. These 
changes in season are sufficiently marked to call for distinct changes 
in weight, warmth, color, and design in clothing and wearing 
apparel. In fact, each month has sufficient change to warrant a 
change in clothing in both design and warmth, and many designers 
have provided not only seasonal but also monthly changes or 
styles. 

Sometimes the seasons are abnormal. Scientists say this is due 
to sun spots, which influence the weather. To illustrate: If a 
winter is mild, without much snow, as in the case of the winter of 
1932, then the full stock of overcoats, mufflers, rubbers, etc., is 
not sold. A mild winter means usually a cold late spring, which 
delays for a while, if not completely, the purchase of much spring 
clothing and wearing apparel. A cool summer often means a warm 
fall, which delays the purchase of both summer and fall clothing. 
These abnormal changes in the weather not only delay the purchase 
of clothing, but often mean that people will do without the purchase 
of much seasonal clothing. The mild winter and late spring of 
1932 caused a falling off in the production of textiles at a time 
when textiles should be sold in the largest amounts, and when the 
prices were very low, as low as before 1914. Unfavorable weather, 
such as a mild winter, will mean that people will not purchase 
as many furs or as much heavy clothing as in a cold winter. 


THE BUSINESS CYCLE 


549 


Hence, such an unfavorable year is reflected in the profits of the fur 
and overcoat lines. 

Similarly, during the years 1930 and 1931, we had an unusually 
large cotton crop, due in part to exceptionally good weather condi¬ 
tions. The effect of such great supplies of cotton for two consecu¬ 
tive years caused a drop in the price, which meant disaster to many 
cotton growers. The same thing occurred with respect to rubber 
production. On the other hand, rainy weather or a frost may cause 
a reduction in the yield of cotton sufficient to raise the price consid¬ 
erably. A mild winter will allow for the development of the boll 
weevil and unusual warmth of summer nights may reduce the 
yield. Thus, it is apparent that abnormal weather may cause 
fluctuations in particular industries, but the sun-spot theory has 
not been considered adequate to explain the general business 
cycle. 

The Political Theory. During political campaigns we always find 
one party blaming the other for creating bad times by means of 
unwise legislation, dangerous political policies, etc. On the other 
hand, if times have been good, we find the party in power claiming 
the credit for “prosperity.” But experience has shown that the 
causes of ups and downs in business are usually too widespread to 
have been controlled by, or seriously affected by, any political 
action. The most severe depressions have been world-wide and 
have occurred without reference to the behavior of any particular 
government or to any governmental policy. Favorable or adverse 
factors in business will sooner or later extend beyond national 
frontiers, and the same social and economic disturbances occur 
under any political regime. This does not mean that certain 
legislation, like tariffs, etc., can not affect business trends. It 
does mean, however, that the general rhythmic movement known 
as the business cycle is not due to the actions of political 
parties. 

The Over-Production Theory. There are some economists who 
say that the fluctuations in business activity are due to an over¬ 
production of commodities. This explanation seems hardly con¬ 
sistent with the earlier description of man’s wants as being infinite 
and capable of great expansion. There is not over-production in 
general, but it is possible to have over-production of particular 


550 ECONOMICS OF CLOTHING AND TEXTILES 


commodities at a certain time. That is, a particular industry 
may find that production has increased to the point where 
it is impossible to sell the goods at a profit, or indeed, in some 
cases, to dispose of them without a great loss. Such a condition 
may arise because of the more or less haphazard manner in which 
many men engaged in the wearing apparel industry carry on 
their business. They are not sufficiently trained, and, while they 
may succeed more or less in prosperous times, they fail in periods 
of depression. 

If we study well-organized industries, we shall find that there 
is a movement on the part of the managers to keep their output at 
a point which will give them maximum profit. Under-production 
would invite more competition. With the boom of prosperity, 
more and more manufacturers enter the wearing apparel field, 
which causes larger and larger amounts of wearing apparel to be 
produced, and this is expected to be sold at higher prices. In 
the manufacture of wearing apparel under free competition, the 
question of the regulation of the supply is very important. This 
is particularly so when there are many competitors. Each one 
may be obliged to work more or less independently, and there may 
be over-production. This is particularly serious in the clothing 
industries because much of the product is seasonal in character 
and must be disposed of before the end of the season regardless of 
price. Changes in style make it impossible to hold the goods until 
there is a demand for them at a price sufficient to cover the cost 
of production. 

Over-production is due in great measure to the policy of mass 
production which is distinctly American. It began with the 
Industrial Revolution and has continued to the present. To 
illustrate: At the beginning of the factory period, machinery was 
responsible for the new prosperity era in civilization. At first 
wage-earners were alarmed at the displacement of man power. 
Then it was found that the cost of production was so much reduced 
that a much greater market was opened up for the cheaper products. 
Additional factories were needed to meet the demand and absorbed 
the labor which had been displaced elsewhere. But that was a 
period of transition — a time when labor-saving devices and new 
cheap goods were much in demand; before they had been too 


THE BUSINESS CYCLE 


551 


expensive and out of reach of the average family. But after 
the period of transition, the situation could continue only when 
the factors of production, consumption, etc., adjusted themselves 
in correct ratio. But the adjustment did not take place, machinery 
continued to be improved, always displacing labor, always increas¬ 
ing output with less effort. However, the demand for the most 
common, easily produced manufactured goods reached more or less 
of a limit, and excess goods began to accumulate, resulting in 
such over-production as to cause unemployment. 

If this great mass production had been developed with the 
equally necessary balancing force — consumption, — then pros¬ 
perity would have continued. Of course, it is true that mass 
production has brought blessings by releasing man from much bur¬ 
densome work and providing many supplies to meet our wants, 
but in addition it has also produced more than could be consumed. 
Mass production reached its zenith after the War, 1920-1930, 
when it developed a new industrial system of economy in costs, 
the reduction in overhead, the ability to produce good articles 
at an unbelievably low price. This was the basis of a new indus¬ 
trial system. There is considerable emphasis at the present time 
discrediting the theory of over-production. While there may be 
temporary over-production in a particular industry, no nation has 
yet found itself too abundantly supplied with economic goods. 
The term over-production usually veils a serious weakness in 
distribution. 

Then again much harm often comes from the excessive use of 
the customary American methods of stimulating sales and widening 
demand. Advertising, high-pressure selling, and the re-creation of 
markets through the agency of style are legitimate and necessary 
instruments of American industrial growth. However, their com¬ 
plete abandonment would mean permanent dislocation of the social 
economy and decades instead of merely a few years of suffering. 
The principle that American industry must correlate demand and 
supply forces on us the practice of producing only what can be 
sold at a profit, which excludes everything that is likely to accumu¬ 
late on the shelves as excess inventories, and everything the sale 
of which will entail a cost in excess of reasonable possibilities of 
profit. 


552 ECONOMICS OF CLOTHING AND TEXTILES 


To summarize the advantages and disadvantages of the factory 
system of production: As the result of the introduction of ma¬ 
chinery, especially automatic machinery, the production per opera¬ 
tive or worker has become so great as to give us great benefits: 
(a) the hours of labor have been reduced, ( b ) the cost of production 
is less because the production per worker becomes much greater, 
(c) increase in the quantity of production, allowing more people 
to use better wearing apparel. On the other hand, the introduction 
of the factory system and highly specialized machines has certain 
handicaps. One disadvantage of the factory system of organiza¬ 
tion is that the mill or factory is equipped to make certain textiles 
and no others. In other words, machines are devised to do a 
special operation on a certain kind of material, and no other. For 
example, a worsted mill can produce either English hard-twisted 
worsted or soft (French) twisted worsteds used mostly for women s 
wear, but not both. It can not produce woolens. The same is 
true with cottons. A mill may be equipped to produce medium- 
grade, or high-grade cottons, but not both. It often happens with 
the change of styles that worsteds may be more popular than 
woolens, and the result will be that the worsted mills will be run¬ 
ning overtime while part of the woolen mills will be idle. Then 
again a mill is laid out with a large number of machines, which 
require a large order to start the mill and keep it running from 
day to day. After the World War, automatic machinery had been 
invented in such form that more fabrics were made than the 
market could absorb, giving us over-production, which lowered 
prices and eventually caused mills and factories to shut down, 
because of the unsold surplus. 

There have been many plans offered for solving this situation of 
over-production when adequate purchasing power is lacking. One 
of these plans is a movement toward a shorter work week, which 
would give labor an opportunity — leisure time — to make use of 
new commodities that have been created, and also increase wages. 

The Speculation Theory. Excessive speculation is another 
explanation offered to explain the business cycle. Often during 
the period of prosperity the banks may become very liberal in 
loaning money for the purchase of equipment, stock, etc. Some 
traders buy raw materials, hoping to sell at a higher price — a 


THE BUSINESS CYCLE 


553 


process which is called speculation. If speculation is carried to 
extremes, banks may lose much of the money that was loaned. 
The stock market is an establishment that has a proper function 
in the community, but it has at times abused its privileges. To 
illustrate : The stock market in 1929 gave a higher rate of interest 
and borrowed money that might otherwise have gone into business 
channels. The consumer purchasing power began slowly to decline 
from this time. Then the banks began to call for the money loaned 
on securities and the price of securities naturally declined. People 
were unable to meet their obligations and many went into bank¬ 
ruptcy. Banks began to fail, were unable to collect on notes, and 
the prices of their securities declined. Then fear crept in and 
people began to lose faith in banks and business. Money was 
withdrawn and placed in safety deposit vaults and hoarded in 
homes. This money was withdrawn from banks in excess of 
regular business needs. 

The question may be asked: Are we justified in being too 
thrifty, saving too much? Will we accumulate too much capital 
goods, which we may not be able to sell? Since the sum total of 
human wants is infinite, business men will always find new avenues 
for the investment of new funds. Over-production in any one 
field brings about a decrease of the rate of profit in that field, 
which naturally discourages additional investment. 

Of course, if the day should arrive when every one has all the 
consumer goods needed to maintain his standard of living, then it 
may not be necessary to save, but we are far from that day. 
Saving increases the supply of capital goods, which increases the 
supply of consumer’s goods — the real test of a people’s standard 
of living. Of course, wages must be high so as to bring these goods 
within the purchasing power of the people. 

Theory of Unequal Distribution of Wealth. Another explanation 
given for the ups and downs of business is the fact that wages do not 
keep in line with the increase of wealth in the nation. Prices in¬ 
crease more rapidly in times of prosperity than wages do, hence 
the consumer purchasing power is insufficient to absorb the in¬ 
creased production. 

To illustrate: If wearing apparel or other goods are created in 
large quantities of varied composition and style, the demand for 


554 ECONOMICS OF CLOTHING AND TEXTILES 


such may be great, but the consumer, because of low wages, may 
not be able to purchase them. Such a condition, carried on, 
would soon cause over-production in all lines. Then the over¬ 
production would lead to curtailment, which means lower wages 
and less purchasing power, finally producing a depression, as 
goods could not be sold. 

One criticism of the present system of mass production is that 
it fails to distribute its products evenly among the whole popula¬ 
tion — it makes many very wealthy, others very poor. Accord¬ 
ing to statistics prepared by W. I. King, who ten years ago 
made a study of records of the probate courts of Massachusetts 
— one of the strong industrial States of the Union — two per cent 
of the people own 60 per cent of the wealth and receive 20 per 
cent of the income; 33 per cent of the people own 34 per cent of the 
wealth and receive 40 per cent of the income; 65 per cent of the 
people own six per cent of the wealth and receive 40 per cent of 
the income. Similar records show that at that time 10 per cent 
of the people owned approximately half of the wealth of the 
country. 

Various devices have been suggested to limit the amount of 
wealth — which means to limit the amount of property. The 
following are the common methods: (a) regulation of prices, 
(b) regulation of corporation finance, (c) income tax, (d) inherit¬ 
ance tax, (e) public ownership of public utilities. 

During the last decade or two a feeling has risen among busi¬ 
ness men that the increased earning power of the worker is the 
foundation stone of prosperity. Therefore, to make industry 
prosper means to make labor prosperous by giving higher wages, 
which would create a larger market, thus increasing the growth 
of the industry. Some people may say that with increased wages 
would come increase in the cost of production, but the increase 
of cost of production has been taken care of by inventions of 
automatic and higher production machinery, plus better business 
management. 

While each year brings to the workers an improvement in wages 
and living conditions, nevertheless they are sharing less proportion¬ 
ally in the prosperity or wealth they are producing. In fact, in 
all our industrial centers, particularly mill and clothing centers, 


THE BUSINESS CYCLE 


555 


there are thousands in misery and destitution because of small 
incomes. 

In a falling market, the prices of both the raw material and 
finished fabric decline. The fabric prices will often decline lower 
than justified by the cost of the raw material. When this condi¬ 
tion takes place, of course, the manufacturing profits are reduced. 
In order to overcome this loss, the manufacturer must, if possible, 
readjust his labor and other costs. Hence the first demand is to 
cut wages. 

We must have in mind that the statement that reduced wages 
mean reduced purchasing power is only partially true. Whether 
reduced wages mean reduced purchasing power or not depends 
entirely upon prices. If wages are reduced, and prices remain on 
the same level, then, or as long as such condition persists, there is 
reduced purchasing power. There is no diminution of purchasing 
power if both reductions are in like proportion. 

Usually living costs drop faster than reduction in pay during a 
depression and living costs rise faster than increase in pay during 
prosperous times. To illustrate : The drop in living costs since the 
beginning of the recent depression was in excess of the average re¬ 
duction in wages, according to a survey of the National Industrial 
Conference Board. The figures revealed by the board show that 
living costs for wage earners declined 20.7 per cent from October, 
1929, to February, 1932, but that salary rates dropped 15 to 
20 per cent, and the wage rate declined 13 per cent. 

The Rise and Fall of Profits. Another popular theory advanced 
to explain the business cycle is the natural rise and fall of profits. 
This theory recognizes that certain forces naturally work together 
to cause a decline in profits toward the end of a period of prosperity, 
thus bringing about the crisis that ends it. Certain of these factors, 
such as increased wages, capital costs, inefficiency, etc., were dis¬ 
cussed earlier. In the same way we saw that during a depression 
certain favorable factors were at work causing profits to increase 
and bring about a recovery. This natural rise and fall of profits is 
considered by many to be the dominating influence in the business 
cycle. 

Pessimism and Optimism. Succeeding waves of pessimism and 
optimism are offered by some economists as explanation for the 


556 ECONOMICS OF CLOTHING AND TEXTILES 


rise and fall in business activity. This has been explained in 
Chapter II, page 51. 

Business recovery is largely a matter of the recovery of individual 
business units. These units multiplied will mean mass recovery. 
As fast as individual business gets its house in order, basically 
right with the economic conditions of today, it can go on to 
new prosperity with the proper use of advertising. In this 
manner unit by unit, business recovery will come, and when it 
does come, it will be sounder than it was before. Those concerns 
who get their houses in order most quickly will be the leaders 
in the new prosperity. 

Suggested Remedies to Eliminate or Lessen the Evils of the 
Business Cycle. Increased Knowledge of Business Conditions. 
One of the first essentials in eliminating the business cycle and 
the evils that it causes is a more accurate knowledge of our indus¬ 
trial system and the way it works. Only by understanding the 
relationship of business conditions and the forces that cause such 
periodic disturbances can we learn how to control them. Business 
study and research and a more accurate forecasting of the trends 
in business activity will, it is believed, enable business and indus¬ 
trial leaders to regulate production, prices, etc., so that there will 
be no such violent fluctuations. 

Long-range Planning. Long-range planning of production, both 
in the fields of public and private works and also in individual indus¬ 
tries, is suggested as one means of evening up business activity and 
preventing periods of extreme prosperity and depression. Large 
public improvements contemplated by the government should be 
planned years in advance so that they can be carried on during 
years when normal business activity is at a low ebb. In this way, 
labor and capital will be put to work at a time when it is least in 
demand for ordinary private enterprise. The results will be bene¬ 
ficial to general business conditions, and will permit public enter¬ 
prise to be carried on at lower costs than if the government launched 
them at a period of high prices, when it must compete with private 
enterprise for money and men. In the same way private enter¬ 
prise, public utilities, etc., could by long-time planning help to 
counteract the effect of declining business as well as carry on their 
own improvements more economically. 


THE BUSINESS CYCLE 


557 


Production schedules should also be planned on a long-time 
basis. It is economically undesirable and politically impossible 
to control prices as long as supplies fluctuate and the demand is 
uncertain. The principles of scientific planning should be applied 
to the textile and wearing apparel trades as far as possible. If 
planning on a scientific basis and an orderly development of our 
resources, our production, and our distribution were brought about, 
depressions and famines would be reduced to a minimum. In the 
past we have had a haphazard and unbalanced control of all forms 
of industry — production and distribution — particularly in the 
wearing apparel industries. 

Control of Credit and Prices. Control of credit by the Federal 
Reserve banks and other financial institutions in such a way as to 
prevent over-development of business in times of prosperity and 
to encourage business enterprise in times of depression is also 
urged as a means of mitigating the evils of the business cycle. 
Such control can be exercised to a large degree through the raising 
or lowering of the rate of discount. To illustrate: In times of 
depression, when much capital equipment is idle and when labor 
is only partially employed, a policy of easy money, through its 
stimulating effect on prices, would tend to lead to increased utiliza¬ 
tion of equipment and of labor, and hence to enlarged production. 
An “easy money” policy under such conditions is, therefore, to be 
pronounced good. On the other hand, when the slack has been 
taken up and when available equipment and labor are fully em¬ 
ployed, “easy money” means simply competitive bidding for a 
share of these available essentials of production with no possibility 
of a profitable increase of output. 

On such a basis we could properly differentiate between credit 
expansion and inflation on the one hand and between contraction 
and deflation on the other. In times of depression, when equip¬ 
ment is largely idle and much labor is unemployed, expansion 
of credit, which may effectively stimulate prices and thus bring 
about increased employment of equipment and labor with a cor¬ 
responding enlargement of output, is to be regarded as normal 
and healthy. Such expansion should not be called inflation. 

Buying power may also be produced by currency inflation, but 
it will last only as long as the inflation process is kept up. When 


558 ECONOMICS OF CLOTHING AND TEXTILES 


inflation ceases, the buying power created by it will cease, business 
will fall off, and prices will come down even more quickly than ever. 

Permanent prosperity is dependent on sustained buying power, 
which in turn rests on confidence, the desire to purchase, and the 
flow of money. The latter is the product of the amount of money 
and its rate of turnover. Neither the amount of money nor its rate 
of turnover taken alone is of importance. It is the product of 
the two factors that provides the power to purchase. 

We may compare purchasing power to water power by substi¬ 
tuting the quantity of water and its velocity for money and its rate 
of turnover. We know that a vast river with a sluggish flow may 
have even less power than a small stream with a swift current. 
Therefore, there was and is no need to increase our gold supply or 
even credit supply or any other form of money to build up purchas¬ 
ing power. In fact, we could do very well with much less money 
than we now have if we circulated it or turned it over with sufficient 
rapidity. On the other hand, an infinite supply of money or credit 
with no circulation is useless as far as buying power is concerned. 
It is like a waveless, tideless ocean — worthless for power gen¬ 
eration. 

The impulse to circulate money is prompted by the desire to 
obtain useful goods and services, or by the desire to increase one’s 
supply of money. In times of depression there is a vast number 
of people with the desire to purchase goods, but they lack money. 
No one wants to lend it to them without security, nor are we 
willing to give it except in relatively small amounts. 

Depression continues as long as commodity prices continue to 
drop. Unless this process is reversed, there can be no recovery. 
This is quite evident. If a mill has to accept only sixty cents 
for each dollar it formerly received, it must get into difficulties. 
The mill owner can not reduce production costs as drastically; 
he can not greatly lower wages; interest and taxes he can not 
lower at all. Prosperity can not come unless business becomes 
profitable. 

Low prices are especially hard on mills or corporations that owe 
money on bonds or mortgages. When they borrowed, the dollar 
had a certain purchasing power; later its purchasing value may be 
fifty per cent higher, or more. To meet payments they must now 


THE BUSINESS CYCLE 


559 


deliver 3000 pounds of wool instead of the 1000 pounds necessary 
in 1923-1928; 300 bales of cotton instead of 100; and so on. They 
can not do it. 

A currency should be stabilized just as the yard is stabilized for 
length and the ton for weight. A dollar’s purchasing power can, 
within satisfactory limits, be regulated by increasing the credit 
basis on which its value depends. The purchase of $400,000,000 
of government bonds by the Federal Reserve in 1922 promptly 
turned prices upward and started recovery. 

The credit base of the United States consists in part of gold and 
in part of government bonds, rediscounts, and bills. Its amount 
can be increased by simply buying more bonds — without in any 
way departing from the gold standard. If the Federal Reserve 
were to buy $5,000,000 of government bonds, the checks given in 
payment would immediately increase buying power. 

Government Interference. Business men feel that the government 
should as far as possible leave industry alone. There is no place 
in the present economic order of the United States for a super¬ 
national industrial planning commission. Under our system we 
must continue to depend on private interest and competition under 
law and government supervision to give direction to our national 
industrial development. Of course in times of depression the 
governments are obliged to interfere. 

One of the leading cotton men in Texas gave voice recently to 
plain facts, showing the costly failure of the United States gov¬ 
ernment’s interference with the marketing of the country’s great¬ 
est textile staple, and to a demand that the government retire from 
the cotton business. 

The extraordinary action of a national wool-marketing organiza¬ 
tion in selecting outlets for the dumping of mohair at a very low 
price and upsetting carpet wool values and sales prospects has 
aroused merited resentment. The fallacy of spending money and 
time in hundreds of trade associations whose operations are limited 
so long as hampering interpretations of the Sherman law hobble 
business and delay an intelligent “trust law” revision is finally 
stirring business men to move against prolonging policies of “fid¬ 
dling legislation” when business men only ask the removal of unfair 
restrictions on their legitimate activities. In 1932 they witnessed 


560 ECONOMICS OF CLOTHING AND TEXTILES 


the normal effect of Japan’s attempt to regulate the production 
and sale of raw silk in a price decline unequaled in the history of 
textile raw materials. 

On April 25, 1932, the Japanese government ended an unlucky 
experiment in state control of the price of basic products by selling 
107,380 bales of raw silk to the Silk Association of America. The 
deal is the largest and the price the lowest ever recorded here. 
The exact price paid is not disclosed, but it is understood to be 
between 430 and 440 yen a bale. When the experiment began, the 
price approximated 1000 yen a bale, so that the government 
agency was involved to the extent of more than 100,000,000 yen 
($32,500,000 at the existing exchange) and shows a loss on the 
entire transaction of about 60,000,000 yen ($19,500,000). 

Textile producers and traders who have suffered unduly for many 
years from governmental interference with the operation of natural 
business laws are beginning to find hope in the rising tide of popular 
wrath provoked by many abuses. 

Despite the views of many successful business leaders and 
statesmen that government interference is not effective in business 
in the last analysis, it was necessary for Congress in 1933 to pass 
a National Industry Recovery Act for a threefold purpose: 
(1) to create employment, (2) to raise wages, and (3) to eradicate 
the irregular and cut-throat competitive practices of business 
which were aggravated by the economic demoralization of the 
depression during the years 1930-1932. This Act did not contem¬ 
plate the fixing of prices and wages by governmental decree nor 
the unionization of labor by Federal command, nor the setting 
up of industrial czars for different trades. It is an attempt to 
stabilize industry by checking and controlling permanently the 
disintegrating forces of the depression of 1929-1932, and to work 
out a better social order between the manufacturers, selling agen¬ 
cies, workers, and the consumers. 

The government encouraged the most successful manufacturers 
and their workers, with the consumers and the public, to work 
out satisfactory schemes called “codes.” One of the first and most 
highly developed codes was that prepared by the cotton industry. 

The Cooperation of Business. Outside of the trade-mark or 
branded textiles there is open competition in the manufacture and 


THE BUSINESS CYCLE 


561 


sale of wearing apparel. European countries have more of a 
monopolistic system, while we have the competitive idea. 

Many thoughtful citizens and others feel that unbridled com¬ 
petition and individual freedom have failed lamentably to insure 
the well-being of individuals or the masses. The plain truth of 
the matter is that the old unbridled competitive system broke down 
in 1930-1932, not only in this country but throughout the world. 
No one who has given much thought to the subject believes that 
this system can be restored on anything like the old lines. The 
question today is how to meet the emergency created by the break¬ 
down of the old system. 

In times of depression like 1932, cut-throat competition took 
place in wearing apparel, such as threatened the existence of the 
industry by insolvency. Certain leaders decided on an informal 
program of cooperation so as to check production and secure prices 
that would give a fair profit. The Department of Justice acted 
under the Sherman Anti-Trust Law in declaring that cooperation 
toward restricting production and maintaining prices was illegal. 
Hence, it will be necessary to have the government modify the 
Anti-Trust Law before the wearing apparel industry may restrict 
production and maintain a price that will give employment and a 
wage that will provide consumer purchasing power. For we all 
realize that unless the profits of industry are widely distributed, the 
purchasing power will not be maintained at average, and hence the 
production facilities will be handicapped by not disposing of their 
product. 

On the other hand, there are those who feel that our recent 
depression was not due alone to the open competitive system, but 
to the great selfishness and ignorance of many of our leaders of 
production. On the one side stands liberty with hundreds of 
years of splendid achievement to its credit, and on the other 
side stand its critics and its enemies, urging the substitution for it 
of compulsion in some one of compulsion’s various forms. These 
include, of course, doctrinaire socialism, communism, and des¬ 
potism. 

Our society, which long rested upon a basis which was almost 
exclusively one of competition, has now passed over to a basis which 
is essentially one of cooperation. This is as true of men as it is of 


562 ECONOMICS OF CLOTHING AND TEXTILES 


nations. Laissez-faire has had its day and has served its purpose. 
We have not yet readjusted our modes of thinking and our legal 
theories and our political axioms to these new conditions. 

It is hoped that our latest depression has developed a new type 
of business man, who will feel his position to be one of trust and 
who will assume his duties with a feeling of cooperation and re¬ 
sponsibility, not only to himself and his trade, but also to society 
and the consumer. 

The welfare of any community, state, or government depends 
upon the closest cooperation and the best feeling between capital, 
labor, and the public. Any hostility or suspicion that ends in a 
strike is costly to the manufacturer whose plant is idle, and he 
loses profits; the laborer’s family suffers loss of wages, and the 
public the loss of services and goods. Sometimes personal violence 
ending in death and destruction of property takes place. 

There are methods of settling differences between manufacturers 
and labor, the same as there are methods for settling differences 
between different manufacturers. The following shows the meth¬ 
ods adapted by different trade organizations with regard to ending 
differences. 

Textile trade organizations have attempted since the depression 
to better trade conditions and also to develop arbitration com¬ 
mittees. In addition the trade organizations hope to utilize 
existing data of research and statistics. 

The very heart of any program for betterment is the use of cur¬ 
rent, or very recent, operating experiences as the basis for calculat¬ 
ing immediate trends in the textile markets. The following 
methods are suggested for the improvement of conditions: 

(a) The preservation and expansion of the Federal Census 
Bureau’s present reports on consumption, active and idle machin¬ 
ery, garment cutting, and other current operations. 

( b ) Interpretative work dealing with these figures, other basic 
data, and special compilations gathered from time to time should 
be undertaken for the industries (and financed by them) by such 
institutions as the Industrial Research Bureau of the University of 
Pennsylvania, the Bureau of Business Research of Harvard 
University, and other similar institutions prepared to do work of 
this sort. 


THE BUSINESS cycle 


563 


(c) Inter-association projects might well be undertaken j ointly by 
the National Association of Manufacturers working with the Gar¬ 
ment Association, the National Retail Dry Goods Association, and, 
when occasion arises, with the manufacturers of other fibers, to end 
some of the more disturbing causes of confusion in textile distribution. 

(d) Either through the National Association of Manufacturers, 
or independently, there should be formed specialized economic 
councils for the fabric industries to consider ways to bring about 
improvement of underlying conditions. These economic councils 
should have as advisory members two or three men from outside 
the industry, representing the law or the public, or both, who would 
discuss all projects from a social point of view. 

(e) Cooperation with the United States Institute for Textile 
Research is suggested as a means of accomplishing some of the 
foregoing ends as well as for furthering research in technical fields. 

(/) Existing bureaus and services designed to help in the solution 
of style problems should be encouraged and perfected. 

(i g ) Mills and selling houses which do not now have an adequate 
or properly manned statistical staff should be encouraged to 
develop one. They can be made to more than pay their way, and 
no betterment of a lasting sort can be expected without adequate 
individual equipment. 

(h) The development of a keener statistical sense on the part of 
many millmen is suggested as a desirable aid to improvement. 

Thus equipped with statistical background, the responsibility 
falls on individual concerns to use the underlying figures and the 
factual records of their own current sales to project plans for a safe 
distance ahead of any given time. 

Disagreements and questions should be settled by committees 
of arbitrators composed of interested representatives and a neutral 
member. The following controversies over raw silk, thrown silk, 
and broad silk have been settled by arbitration by the Silk Asso¬ 
ciation of America, Inc., whose arbitration facilities made possible 
the amicable settlement of the controversies covered. 

A broad silk manufacturer claimed that the China raw silk delivered 
against a letter of credit contract calling for Extra A grade was not of the 
required percentage of evenness for that grade, and he asked reimburse¬ 
ment of $7000, this being the difference in value of the quality delivered 


564 ECONOMICS OF CLOTHING AND TEXTILES 


and the quality he claimed he should have received. He stated that 
immediately upon discovering the inferior grade he requested replace¬ 
ment, which was refused. He admitted, however, that the silk had not 
been tested until two months after delivery. The raw silk dealer con¬ 
tended that the silk delivered was of the quality called for in the contract, 
no percentage of evenness having been stipulated. He claimed that if 
the silk were inferior he should have been given the opportunity to make 
replacement within the 15 days provided for in the Raw Silk Rules of 
the Silk Association of America, Inc., which were part of the contract. 
After consideration of the evidence it was pointed out that there was no 
stipulated percentage of evenness for China silks and that the chops 
delivered were standard chops for Extra A silk. The arbitrators decided 
that the silk delivered was of the quality called for in the contract and 
that the broad silk manufacturer was not entitled to any damages. 

Social Effects of the Business Cycle. Any sudden change in the 
price level, whether it is up or down, naturally brings hardship to 
certain groups of individuals and enterprises. Because wages tend 
to lag behind other prices in the upward course of prosperity, labor 
does not immediately feel the benefits of good times. Of course, 
regularity of employment tends to counteract this effect, and during 
the later stages of a boom wages tend to catch up with prices. 
After the crisis and during the deflation period wages tend to 
drop slowly. Hence the real wages of the worker may be higher 
for a time. But unemployment increases rapidly and reduces 
standards of living, and actual privation is the lot of many workers. 
Labor is thus the chief victim of the business cycle. 

Business men and entrepreneurs reap great profits during the 
boom period of the cycle, but the casualties among business enter¬ 
prises are numerous during the depression period. A stabilization 
of business activity would offer greater opportunities for regular 
profits and income, even if the easy profits of the boom period were 
eliminated. 

The effect of the business cycle on creditors and debtors is ex¬ 
treme. Thus a man borrowing $1000 when prices are low, and 
forced to repay it when prices have risen greatly, gives back much 
less in purchasing power than he received. The creditor in this 
case receives much less in actual purchasing power than he gave 
when he loaned the money. These inequalities work much hard¬ 
ship and make it impossible to feel sure of future conditions. 


THE BUSINESS CYCLE 


565 


The purchasing power of fixed incomes varies greatly during the 
various stages of the business cycle. Thus a person receiving such 
an income has a larger purchasing power when prices are low and a 
greatly diminished purchasing income when prices rise. 

Our American general price-level, including retail prices, rents, 
and wages, as well as wholesale prices, fell about 24 per cent be¬ 
tween 1929 and 1932. In other words, our American gold dollar 
would buy about 33 per cent more on the average in 1932 than 
it did in 1929. Falling prices depress business and cause unem¬ 
ployment. 

They impose continually increasing burdens upon the debtor 
class: upon the home buyer and the farmer who are struggling to 
pay off mortgages on their property; upon governmental bodies 
national, state, and local, and large public utilities and industrial 
corporations, with their heavy bond obligations. Debts, unfor¬ 
tunately, do not decline in volume as income fades away, or as the 
value of the dollar in which they are payable increases. 

Crime and Suffering. One of the great causes of crime is the 
economic cause. Statistics show that the so-called “hard times” 
have always increased the number of criminals in a community. 
Enforced idleness, due to depression in industries and business, 
causes starvation, which leads to begging and stealing. Society 
must provide agencies to respond quickly with temporary relief 
during the periods of unemployment which occur with varying 
degrees of frequency and intensity, or else expect increase in crime. 

Emergence of Small Business. One striking feature of the 
recent troubled business period has been the emergence of small 
business. There were more new companies formed in New York 
State during January, 1932, than in any other month of the 
depression except March, 1931. It is interesting to note that many 
of these small new firms were organized by men who had been 
thrown out of employment by the larger companies. 

Most of the larger concerns were in an awkward position during 
the depression and were facing a unique economic situation. 
Enormous plant capacities, developed to meet the artificial markets 
created by high-pressure merchandising methods, were out of 
keeping with the normal requirements of supply and demand. The 
effort to keep the demand inflated to the pitch set by the ability 


566 ECONOMICS OF CLOTHING AND TEXTILES 


to supply the purchasing power was reaching its limits. It was 
recognized that normally the market could not absorb all that could 
be turned out by mass-production methods. The idea of install¬ 
ment buying was cleverly sold to the public so thoroughly that, for 
a time at least, general business enjoyed what appeared to be a 
period of real prosperity. 

With the smaller concern, demand controls the supply. There 
is no temptation to increase the supply beyond the requirements 
of the immediate market. Because of the inability of the larger 
organizations to adjust themselves quickly to rapidly changing 
conditions, and because the smaller concern can profitably sell its 
products at a lower price in these times, it is certain to be an im¬ 
portant factor in the process of business recovery. Especially im¬ 
portant is the smaller concern because it thrives on ideas and 
inventions. 

Elimination of Inefficient Business Units. One of the favorable 
aspects of the business cycle is that it tends to eliminate inefficient 
units of production. While this may be a desirable end, it would 
seem that such control could be achieved by less disastrous meth¬ 
ods. The great mortality of business enterprises because of failures 
and bankruptcy is at best an uneconomic and wasteful process. 

A careful study of business failures shows that the majority of 
men who go into business fail. This is particularly true in re¬ 
gard to the textile and clothing trades. Most of ‘the men in the 
clothing business ought to be working for some one else. 

During the years 1931 and 1932, more failures took place in the 
textile and cutting-up trade than in any other industry. In 1931, 
the National Credit Office found 1057 firms, with liabilities of 
$40,939,000, forced out of business. The depression naturally 
forced out the inefficient units. 

A study of the failures or insolvencies during the depression of 
1932 shows, according to the research department of the National 
Credit Office, that a total of 382 firms, involving liabilities of 
$17,029,000, were forced out of business by adverse trade condi¬ 
tions, price instability, failure to adjust operating expenses to meet 
reduced sales volume, and restriction of sales by credit hazards. 
Insolvencies were 16 per cent ahead of the last quarter in 1931, 
and showed a gain of 21 per cent over the previous quarter. There 


THE BUSINESS CYCLE 


567 


were 46 per cent more failures in the first three months of 1932 
than in the same period of 1931. Liabilities of the failures in 
the first quarter of 1932 exceeded those in 1931 by 46 per cent. 

The most favorable record was that of the manufacturers of 
dresses and costumes. In this division the number of insolvencies 
exceeded the number of the first quarter of 1931 by only 12 per cent, 
while the increase in liabilities was 14 per cent. The number of 
first quarter failures was 33 per cent under the number reported in 
the final quarter of 1931, while liabilities of the final period were 
under those of the last three months of 1931 by 15 per cent. This 
showing is in sharp contrast to that of the other divisions, because 
of the small increase over the first quarter of 1932 and substantial 
drop from the totals of the last quarter of 1931. 

In the miscellaneous silk division, failures numbered 20 per cent 
more than in the first quarter of 1931, while liabilities were 25 per 
cent greater. The comparison with the final quarter of 1931 shows 
an increase of 18 per cent in number and 14 per cent in liabilities. 

There were 56 failures among wholesalers of dry goods and knit 
goods in the first quarter. The liabilities involved were $3,522,000. 
This number was 47 per cent higher than the number in the same 
quarter of 1931 and 211 per cent higher than the number reported 
for the last quarter of 1931. The liabilities were 60 per cent above 
those of the first quarter of 1931 and 260 per cent greater than 
those of the last quarter. 

The cotton goods division of the textile industry showed the 
largest gain in comparison with the first quarter of 1931. The 
number of cotton goods failures was 94 per cent higher than the 
number in 1932. The failure level in this group was also well above 
that of the last quarter of 1931, with gains of 51 per cent and 18 
per cent respectively in number and liabilities. 

Manufacturers of coats and suits failed to the number of 53. 
This was 61 per cent more than failed in the first quarter of 1931, 
but it is exactly the same number as failed in the last quarter of 
1932. The liabilities of these failures at $1,386,000 were 41 per 
cent higher than the liabilities of the first three months of 1931. 
The comparison with the liabilities total of the final quarter of 1932 
is far more encouraging since it shows a decrease of about 20 per 
cent. 


568 ECONOMICS OF CLOTHING AND TEXTILES 


There were 60 per cent more insolvencies among the manufac¬ 
turers of clothing in the first quarter of 1933 than in the first quarter 
of 1932. The gain in liabilities was 40 per cent. In this group, 
also, the liability comparison with the final quarter of 1931 was 
more favorable. Although the increase in number was 60 per cent 
— the same as that between the two first quarters — the liabilities 
of the first quarter of 1933 were only 8 per cent above those of the 
last quarter of 1932. 

In the analysis of these failures the fact showed clearly that 
many concerns had not adequately adjusted operating expenses, 
such as rentals and leaseholds, to meet reduced sales volume. In a 
number of cases, of course, rentals could not be readjusted. Ex¬ 
penses disproportionate to gross profits or out of line with working 
capital result in an excess of cost outlay over sales income. 

There were a number of instances of sales restricted because of 
credit hazards without regard to sales volume. Few failures were 
due to an overbuying or overstocked condition. The steady down¬ 
ward trend in the prices of a number of major commodities caused 
losses beyond the control even of conservative operators. 

Figures for the first quarter follow: 

Manufacturers of coats and suits, 53, $1,397,000; clothing manu¬ 
facturers, 56, $3,754,000; dresses and costumes, 55, $2,105,000; dry 
goods and knit goods wholesalers, 56, $3,522,000; miscellaneous cotton, 
91, $4,112,000; miscellaneous silk, 71, $3,150,000. 

Following are the records for 1931 by quarters : 

Coats and suits—First, 33, $975,000; second, 36, $941,000; third, 
20, $504,000; fourth, 53, $1,733,000; total, 142, $4,153,000. Failures 
totaled 11.3 per cent of the entire industry. 

Clothing — First, 35, $1,890,000; second, 24, $827,000; third, 33, 
$1,730,000; fourth, 61, $2,555,000; total, 153, $7,002,000, or 8 per cent 
of industry. 

Dresses and costumes — First, 49, $1,841,000; second, 56, $2,590,000; 
total, 259, $10,257,000, or 12.4 per cent. 

Dry goods and knit goods —First, 38, $2,205,000; second, 18, $657,- 
000; third, 13, $781,000; fourth, 18, $980,000; total, 90, $4,623,000, or 
3.4 per cent. 

Miscellaneous cotton — First, 47, $2,247,000; second, 41, $3,897,000; 
third, 38, $3,628,000; fourth, 60, $3,460,000; total, 186, $13,232,000, or 
2.9 per cent. 


THE BUSINESS CYCLE 


569 


Miscellaneous silk —First, 59, $2,514,000; second, 60, $3,474,000; 
third, 48, $2,923,000; fourth, 60, $2,761,000; total, 227, $11,672,000, or 
4.5 per cent. 

Business failures occur at an unusually high rate during the 
times of depression and for some time afterwards, even though a 
trade upturn may be initiated during that period. Creditors may 
be showing a certain amount of tolerance, due to the fact that 
times are regarded as bad, but they will immediately demand debt 
settlements as soon as industrial conditions start to move forward. 
Consequently, a business revival will be accompanied by a steady 
flood of suspensions. 

In an effort to aid during depression, credit associations are sug¬ 
gesting that three practices be followed in the extension of credit. 
First, where any community is financially embarrassed by a 
natural calamity, such as drought, a flood, etc., it is advised that 
creditors be lenient and extend a measure of helpfulness. Second, 
when customers are affected adversely by bank failures, credit men 
are asked not to press them nor penalize them for something which 
is beyond their control. Third, when the debtor is a man who has 
had an enviable record in the past, has been in business for some 
years, is distinguished by character and capacity, and is helpful to 
his community, moderate forbearance on the question of debt 
payments is also advocated. 

Credit men, however, are being warned against selling terms 
instead of goods. Many manufacturers and wholesalers are so 
eager to move merchandise that they specify payments within six 
to eight months. While no doubt a reasonable leniency as to terms 
may be desirable in especial instances, too rapid an inflation of 
commercial credit through selling terms is dangerous. 

The large number of failures among manufacturers may be traced 
to the heavy write-offs in inventory values during the years of 
depression. Many producers who in boom times segregated their 
stocks carefully and gave the proper valuation to slow-moving or 
practically unsalable items attempted to place a disproportion¬ 
ately high value on such numbers at the close of 1932, in order 
to improve their statements. Consequently, creditors who were 
aware of the situation refused to be tolerant and pressed for settle¬ 
ment of their claims. 


570 ECONOMICS OF CLOTHING AND TEXTILES 


The textile and clothing trades have many more failures than 
any other lines and many of the firms that fail offer unsatisfactory 
settlements. Credit men are determined to destroy the technique 
developed by traders who have been implicated in suspicious 
bankruptcies and are planning to hire expert investigators to look 
into all receiverships and bankruptcies. It is said that many firms 
which have gone into bankruptcy could have been prosecuted, but 
that credit men refused to do so because of the time and expense 
involved. In many cases settlements have been made on the basis 
of ten cents on the dollar when creditors have felt certain that 
double that amount could have been paid. 

Mergers. Even while we find the number of small businesses 
increasing during a depression, we find a movement toward mergers 
being carried on by other companies. Thus, while banks have 
been entering so many mergers, the textile factoring houses of New 
York have been moving in the same tide. These factors check the 
customer’s credits and discount the sale of a large part of the textile 
business of the country, so that the concentration of the service in 
fewer and very strong hands will be a stabilizing influence. 

A merger between two rival silk firms was commended in the 
following terms by an executive of one firm: 

We were convinced that customers of both companies could secure 
better service if the companies were combined and that the cost of serving 
these customers could be materially reduced. Both companies have 
adhered to very high standards in the manufacture of their products. 
Combined, the quality standards can be raised still further through the 
ability of the combined company to proceed with the installation of certain 
new equipment and processes which, in our opinion, are superior to any¬ 
thing yet produced. This equipment entails substantial capital invest¬ 
ment. It would be economic waste for both companies to make this 
same investment. 

The products of both companies have tremendous consumer accept¬ 
ance. Each has spent millions of dollars in advertising. Combined, 
an even more effective job of promotion could be undertaken. The 
management of both companies, after many discussions, are substantially 
in agreement. But there are many phases of the merger which must 
yet be worked out. 

In the meantime, customers of both companies can feel assured that 
not only will every phase of each company’s operations continue as 


THE BUSINESS CYCLE 


571 


before, but that the planned move will result in decided improvements 
to them in service, in quality, and in economical distribution. The 
major lines of each company will be retained, the only significant change 
will be the results of endeavors to make still better products. 

Undesirable Trade Practices. Because of the intense competi¬ 
tion that arises during a period of depression we find many unde¬ 
sirable trade practices appearing at such times. One of the most 
serious problems of the wearing apparel industry is the policy of 
cutting prices. In times of depression or bad times, the business 
man finds it difficult to sell, and is often obliged to sell at a loss in 
order to keep his factory or mill going and give the employees suf¬ 
ficient to keep life together. 

At times cotton textile manufacturers have been selling certain 
fabrics at prices below cost on account of excessive stocks. Under 
depression conditions, it is understandable that a mill would be 
willing to dispose of its products at a figure which would represent 
“breaking even,” or at worst, a slight loss, but it seems unbelievable 
that a mill should be ready to contract its output for months ahead 
at quotations which represent a loss of one-fourth cent to one cent 
a yard on every piece of goods turned out. 

Curtailment is the first-hand solution, but the problem is not as 
easy as that. A difficult factor is the one-mill village, the small 
community, usually in the South, where the entire business and 
social life revolves about its textile plant. The owner often knows 
all of his employees personally, and his interests extend to the 
town's retail and banking business. In other communities the mills 
own or control these banks and stores. Prosperity or hardship and 
deprivation rise and fall with the town's one mill. 

These conditions create a trying problem for the manufacturer. 
To get the limited business available, he must take prices that are 
below cost; he has duties to his directors and stockholders, and he 
also faces the risk of dissipating the corporation’s assets if he ac¬ 
cepts an offer. At the same time he is bound by emotional ties to 
his community and often receives direct appeals from families in 
distress. 

Until recently many millmen could console themselves with the 
knowledge that the overhead cost of a closed plant was as large as 
losses entailed by partial operation. 


572 ECONOMICS OF CLOTHING AND TEXTILES 


An intelligent control of production will mean more work at 
better wages, but this will not make any easier the position of the 
man owning the one mill in the village, called upon to explain 
economic principles to a delegation of workers whom he has known 
and worked with all his life. This may explain one reason why 
curtailment, which seems to be such a simple and obvious solution 
to the disinterested person, is difficult to put into practice in the 
textile industry. 

Capital and the production industries are beginning to under¬ 
stand that price-cutting is a menace to prosperity because it 
strikes at its very heart, — fair profits, — out of which wages, 
dividends, and consuming power can be maintained and increased. 
Without this foundation of profit there can be no constant em¬ 
ployment. When competition succeeds, not by means of lowering 
costs, but by reduced prices which are uneconomic and profitless, 
we force an artificial decline in commodity prices. This, as 
economists inform us, leads to a vicious circle, with lowered buying 
power. 

Reduction in the quality of product is also a common practice 
during a depression. In textiles, almost immediately in previous 
depressions, virtually everybody began making and selling cheap 
goods, which were wholly without character and were made to sell 
at whatever price the public could pay. 

During the depression of 1932 the output of the average textile 
producer maintained its regular standard of character in very high 
degree, although the prices at which textiles were offered to the 
public sank far below the level at which the producers could get 
a new dollar for an old one. 

Accordingly financial loss to the textile manufacturer naturally 
resulted. Economies which he made possible were heedlessly 
passed on to an unappreciative general public by cutters-up, 
jobbers, and retailers, so that in 1932 the position of the textile 
manufacturer was more difficult than at the beginning of the de¬ 
pression. As a consequence, materials and merchandise of poor 
quality began to reach the buying public and protests began to arise. 

It is admitted that during the last generation the appreciation 
of quality has diminished. The public has been misled into sub¬ 
stituting appearance for quality. If the merchandise made a good 


THE BUSINESS CYCLE 


573 


appearance as to style, color, etc., and as to price, it was readily 
accepted by the public. This attitude has opened wide to cut- 
ters-up and retailers the avenues of substitution and to textile 
manufacturers the ways of manipulation. 

Depressions in Special Industries. Depressions in single indus¬ 
tries frequently have their source in causes not directly connected 
with the business cycle. Thus many industries, notably in the 
clothing and wearing apparel field, have suffered from seasonal 
unemployment, that is, the employment of workers during only a 
portion of the year. Such periods of slack business activity were 
formerly considered to be a necessary evil, but research and study 
in recent years have indicated that by proper planning of industrial 
schedules much may be done to iron out irregularities due to 
seasonal products. The dovetailing of two kinds of production, 
advertising, manufacturing stock in dull periods, etc., have been 
found helpful in stabilizing business activity in such indus¬ 
tries. 

In the clothing industry many cases of distress in special branches 
of production may be traced to changes of fashion. Fashions or 
changes of style in wearing apparel are naturally frequent. Con¬ 
sumers and others, in making these changes, should give sufficient 
time for the change for the different trades affected to make adjust¬ 
ments so they will be able to pass from one line of wearing apparel 
to another without too great financial loss. In the past, tragic tales 
are told of how certain trades and industries were wiped out of 
existence in a few months without sufficient time to change to 
another line. To illustrate : When the styles a few years ago were 
in favor of slimmer silhouettes, the petticoat trade was practically 
eliminated. The same was true with the hair-pin industry when 
bobbed hair became popular, and also with the feather trade in 1918. 
But the trades revive again when the cycle of fashion returns, as 
in the demand for feathers in 1931. Then overnight the 15 mem¬ 
bers of the feather trades were increased to 300. The effect is more 
noticeable in the ostrich trade. In 1912 there were a million 
ostriches in Africa, yielding feathers to decorate hats. Then when 
the fashion of feathers declined in popularity, the number was 
reduced to 10,000. In 1931 the 10,000 were unable to meet the 
demand. Then adulterations were practiced and feathers of all 


574 ECONOMICS OF CLOTHING AND TEXTILES 


kinds are used, dyed and colored in an artificial manner, to meet 
the needs of the styles. 

In times of depression it becomes necessary for industries to 
merge, consolidate, and attempt to cover a wider rather than a 
narrow field of wearing apparel. This is shown in the condition 
of a ribbon mill during the depression. In the textile trade nearly 
every one knows that the ribbon industry is uncertain, and that the 
world’s greatest flow of ribbons is turned out by one plant, which 
has built up an important enterprise from a small beginning 
in 1878. 

With the annual capacity of between 110,000,000 and 115,000,000 
yards, and facilities for manufacturing every known type and qual¬ 
ity of ribbon, the company has far outstripped any similar enter¬ 
prise and is selling more ribbon to the retail trade than all other 
concerns combined. 

Products of the corporation are used by some twenty different 
branches of industry, including the blanket, candy, suspender, 
badge, florist, ladies’ wearing apparel, corset and underwear, men’s 
hat, shoe, garter, greeting card, infant’s wear and cap, novelties, 
tobacco, baking, interior decorating, linen, handkerchief, and 
stationery trades. 

Efficiency Methods. In times of depression production costs 
must be cut. One of the most successful means of accomplishing 
this is by the adoption of so-called efficiency methods. 

The efficiency system, designed primarily to reduce production 
costs, applies chiefly to the weave room in a mill but has been 
extended to other departments. It varies widely in different mills 
and is not new. It has been successfully used by many mills for 
a number of years without friction. Briefly the system makes the 
weaver a highly skilled worker, giving skilled work to skilled workers 
and less skilled work to less skilled workers. It relieves weavers of 
all duties except the actual operation of looms, and makes it possi¬ 
ble for them to handle a greater number of looms, thereby producing 
more cloth and earning more money under the piece-rate system. 

This system of operation is being successfully carried out by 
many Southern mills with the approval rather than the resentment 
of the workers. One large group of mills reports that its weavers 
earn 20 per cent more than formerly. An engineering company 


THE BUSINESS CYCLE 


575 


which has installed the system in a large number of Southern plants 
asserts that without exception these companies are paying increased 
wages for increased work. 

The Wool Industry. Changes in styles to follow the general 
movement of less bulk in wearing apparel have curtailed to a con¬ 
siderable extent the use of wool and cotton fabrics. 

The year 1909 represented one of the most prosperous years in 
textiles in the United States, particularly in the woolen and worsted 
trade. At that time there were produced 6^ square yards of 
women’s woolen and worsted dress goods per person in the country 
(spoken of as per capita). Changes in style of women’s wearing 
apparel have caused the quantity per capita to become smaller 
and smaller, until in 1929 the total production amounted to a trifle 
more than one square yard per capita. After 1929, a slow move¬ 
ment began toward woolens in place of silk. In 1931 there 
appeared a fashion trend toward woolen, which created a better 
demand for wool. The spring and summer of 1931 saw the 
development of light-weight woolen dress goods that for style, 
lightness, and beauty surpassed anything ever before attempted. 

This increased interest in the use of woolens has been due to a 
campaign of several years by wool trades to advertise the merits of 
woolen products by a systematic advertising scheme: 

1. The wool industry has every year a wool week in which 
meetings are held discussing the merits of woolen and worsted 
fabrics. 

2. Fashion shows have been held at hotels, stores, etc., showing 
the artistic value of woolen and worsted fabrics. 

3. In addition to the women’s wear part of the business the wool 
trade is also aiming to dress up the men of the country. By sugges¬ 
tion and appeal it is possible for men to “perk up” in their dress. 

Adverse conditions in the wool market are not entirely due to 
the depression, as certain of the underlying factors had been 
becoming cumulatively worse for many years. Flocks of sheep 
which were seriously depleted during the War have been steadily 
increased throughout the world during the past decade, and there 
has been a corresponding expansion in the annual wool clip. The 
total number of sheep in all important wool-producing countries, 
except Russia, was 21 per cent larger in 1931 than in 1923-1925, 


576 ECONOMICS OF CLOTHING AND TEXTILES 


while world wool production in 1931 showed an increase of 25 per 
cent over the average clip in the years 1923—1925. Estimates 
indicated a slight decrease in United States clips in 1932, owing 
to unfavorable weather on the ranges, but world supplies of wool are 
more likely to increase than decline. 

A number of factors may be materially improved. Cancella¬ 
tions, hand-to-mouth buying, deferred ordering, uncertainties of 
style and fashion trends, instability of color standards, price demor¬ 
alization, design piracy, unnecessary three-shift operation, faulty 
costing — these and many others are the pressing problems of the 
industry. 

The Silk Industry. The silk industry has passed through vari¬ 
ous stages of development as regards prosperity and depression. 
These fluctuations have been due in large measure to irregular pro¬ 
duction because of varying weather conditions and lack of proper 
care for the silkworms. 

The silk dress goods industry of the United States began in 1909 
to enter upon a great era of expansion. It increased and decreased 
at various times, until about 1929 there began a movement in style 
tendencies toward woolen dresses instead of silk. Silk exhibitions 
and campaigns to arouse greater interest and more appreciation of 
silk fabrics have done much to bring silk back into favor. 

From 1870 to 1890 the value of the silk industry’s product in this 
country increased from $12,000,000 to $87,000,000. Relatively 
speaking, this branch made greater progress than any other in the 
textile industry. However, silks experienced an acute depression 
in 1890-1891, as did general business. 

The production of broad silks in the United States in 1870 was 
approximately 1,000,000 yards. It is interesting to compare this 
with the nearly 600,000,000 yards produced in 1929. 

Between 1914 and 1925 the value of silk goods manufactured in 
America increased 218 per cent as compared with 158 per cent and 
159 per cent respectively for woolens and cottons. 

The best raw silk varies considerably in price, due to rapidly 
changing market conditions. Double extra cracks or best grade 
ran up to $17 a pound after the World War and is seldom to be had 
at the old levels of $4.50 to $6.00 a pound, which range of prices 
held for nearly 100 years. While such violent fluctuations as those 


THE BUSINESS CYCLE 


577 


obtaining in 1919 and 1920 are unusual, many other elements affect 
prices. These may be abnormal weather conditions, such as a very 
wet or a very hot season, or epidemics of diseases to which silk¬ 
worms are subject. The terrible disaster in the shape of earth¬ 
quake, fire, and tidal wave that overtook Japan in 1923 further 
unsettled the market, as not only was a great quantity of raw silk 
destroyed, but the transportation, conditioning, testing, and 
storage of raw silk was greatly impeded. 

During 1931, for the third year in succession, the silk market was 
most disappointing. Silk was worth, in 1932, in gold, one-half 
of what it was worth at the beginning of 1930, and only one-tenth 
of what it was worth at the highest in 1920. Neither cotton nor 
wool has fallen in value to the same extent. No one could foresee, 
or even conceive, that silk could be sold as cheap as it is now. 

The drop in the price of silk has affected many silk manufacturers, 
as shown in the following reports. Raw silk, which commanded 
a level of about $5 a pound in January, 1930, dropped to $2.25 by 
the end of the year, which necessitated considerable adjustment of 
inventories. One firm in hosiery reported a deficit of $559,000 in 
that year, compared with a profit of $1,804,619 in 1929. Although 
some improvement in earnings took place in the following year, 
silk prices slumped still further. 

An unfavorable reaction from the buying public in the matter of 
over-weighted, sometimes called par-weighted, silk is slowly but 
surely leading to a popular demand for pure dye fabrics. Much 
has been made of the desirability of par-weighted silks. When 
the weighting process results in an honest restoration of the 
weight of the silk lost through the boil-off process, the silks fulfill 
all expectations in the matter of wear, but too many sellers are 
using the term par-weighted indiscriminately. 

In the mad rush to achieve price, over-weighted silk piece goods 
and ready-to-wear garments have been sold in huge quantities. 
As a result, a renewed demand from the consumer for pure dye 
fabrics is already making itself felt. 

The Cotton Industry. Cotton fabrics have always been popular 
because they are cheap, durable, and washable. But with changes 
in styles toward lighter and less clothing, particularly undercloth¬ 
ing, cotton has suffered. Then again, since women have entered 


578 ECONOMICS OF CLOTHING AND TEXTILES 


business they demand fabrics of better design, that can be easily 
washed, and that are more stylish in appearance, especially in 
hosiery. Silk and rayon became great competitors of cotton. 
Then again, during the years 1929-1931 weather was favorable to 
the growth of cotton, and this condition, plus additional use of fer¬ 
tilizers, gave the country excessive over-production. This caused 
a decline. But through campaigns of advertising by the Cotton 
Institute, as described on pages 620, 621, cotton in 1932 came back 
at the expense of silk and rayon. 

For eight years prior to 1930, the average annual domestic 
market for woven cotton goods was 7,554,000,000 square yards. In 
each of three years, 1923, 1927, and 1929, it exceeded 8,000,000,000 
square yards. During this entire period only one year fell below 
7,250,000,000 square yards, which is slightly under the ten-year 
average of 7,293,164,000 square yards. In percentage relationship, 
1930 consumption was 84.7 per cent of this average and 1931 
reached 86.64 per cent. 

The number of customers naturally increases with the rise in 
population. Excepting radical changes in custom, which have not 
been of special significance during this period, gain in consumption 
depends on purchasing power as well as on the number of con¬ 
sumers. Since 1929, disturbed economic conditions have brought 
about a severe contraction in general income, which has been 
reflected in a reduction of the per capita consumption of woven 
cotton cloth from an average of 65.3 yards in 1922-1929 to less than 
51 yards for each of the years 1930 and 1931. The ten-year average 
is 62.19 square yards. 

The textile wants of 125 million people are greater than those 
of 110 million were ten years ago. Any reasonable economic 
improvement should bring the per capita consumption up to the 
ten-year average. This would mean an annual domestic market 
of 7,773,750,000 square yards and, with average exports added, 
about 8,181,903,000 square yards. The making of such a yardage 
would require 95,693,653,000 spindle hours of 3015 hours per year 
for each of the 31,737,174 spindles now in place. 

This survey is a reasonably accurate record of the cotton textile 
industry during the past decade. Its application to specific classi¬ 
fications of product is not appropriate because the changes both in 


THE BUSINESS CYCLE 


579 


consumption and equipment have been irregular with respect to 
various kinds of goods. The data on plant equipment and its 
activity includes, necessarily, machinery and its operation in 
purely spinning mills and in mills whose yarn is used for products 
other than woven goods over 12 inches in width, such as twine, 
cordage, tape, knit goods, etc. 

The Rayon Industry. Sometimes silk fabrics are popular and are 
in great demand. Then rayon will take the place of silk; at other 
times worsted or woolens may be popular. One of the strongest 
competitors of silk has been the recently developed synthetic fiber, 
rayon. 

When rayon was first placed on the market, it was lustrous 
and was called artificial silk. Later it was called rayon, and cer¬ 
tain forms of manufactured rayon were called synthetic fibers. 
The fabric carried out the military effect of the style tendencies. 
After a period the military style tendency began to decline, and 
it was advisable to reduce the luster of rayon. This reduction was 
continued until in 1931 some of the rayons had as little luster 
as cotton. 

Rayon is being adapted to other uses of wearing apparel, par¬ 
ticularly accessories — umbrella cloth to take the place of gloria 
(silk and wool, silk and cotton). It has also been used for water¬ 
proofing. 

Rayon, offspring of necessity, is by far the youngest member of 
the textile family. Unlike cotton, wool, silk, and flax, on which the 
world has been dependent through the ages, rayon is a product of 
modern ingenuity. The World War, which compelled Europe to 
look for substitutes for a great many articles of clothing, gave 
rayon its real beginning. Since then the growth has been tremen¬ 
dous — first abroad and then on this side of the ocean. 

In the past decade the United States has taken the lead by a 
wide margin in production as well as consumption. In spite of 
fluctuations of activity in other textile fields, production of rayon 
yarn established a new high record in 1931, amounting to about 
143,900,000 pounds, a gain of more than 30 per cent over the 
previous year, while consumption of 150,000,000 pounds was about 
43 per cent ahead of 1930. In 1933 the production was 207,600,000 
pounds. 


580 ECONOMICS OF CLOTHING AND TEXTILES 


Rayon producers in the United States during 1931 accounted for 
approximately 30 per cent of the world’s output. This nation 
was far ahead of its nearest competitor, Italy. Furthermore, 
domestic consumption composed almost 35 per cent of the world 
usage. The following tabulation in thousand pounds shows world 
production and consumption in 1931, the output including viscose 
and acetate, the principal processes: 


Country 

Production 

Consumption 

Belgium. 

. 10,150 

5,148 

United Kingdom. 

. 54,165 

48,200 

Canada. 

. 5,600 

6,000 

Czechoslovakia. 

. 4,620 

14,300 

France. 

. 38,320 

18,460 

Germany. 

. 52,000 

62,500 

Netherlands. 

. 20,250 

2,350 

Italy. 

. 74,000 

23,000 

Japan. 

. 47,450 

43,000 

Poland. 

. 4,850 

4,500 

Switzerland. 

. 9,000 

3,200 

United States. 

.144,350 

154,350 

Other Countries. 

. 2,750 

55,600 

Total. 

.467,505 

440,608 


The rayon industry in this country has had to face the usual 
problems of price-cutting, which, while not as drastic as in other 
branches of the business, were nevertheless an important factor 
in 1931 because of carry-over stocks and prices of other fibers. 
In the viscose field, responsible for about 85 per cent of the total 
production at home, producers have made considerable progress 
toward stabilization. Competition, however, is keen and price 
unsettlement has caused considerable uncertainty in the current 
year. 

The Industrial Rayon Corporation, by virtue of its low-cost 
plants, ranks as one of the leading manufacturers of viscose rayon 
yarn in this country. Its annual capacity is rated at between 
13,000,000 and 15,000,000 pounds. The results of this concern in 
1931 reflected the increasing competition and price-cutting tacr 
tics of principal units. An additional factor contributing to the 
















THE BUSINESS CYCLE 581 

relatively poor showing for that year was the liquidation of obsolete 
products at unprofitable levels. 

Unlike all other textile fibers, because of its mechanized chemical 
production, it is possible for rayon manufacturers to insure price 
stability by regulating supply and demand in accordance with the 
consumption requirements of customers. It is now said that this 
policy of regulation is to be followed by contracting output until 
demand revives. 

Idle Equipment. Each branch of the textile industry requires 
special machinery for manufacturing its product. In addition, 
each plant is highly specialized, and manufactures one kind of prod¬ 
uct. Hence, when one phase of the industry is busy, due to the 
popularity of that product, other plants are idle and the capital 
involved in the equipment and plant is producing no income. 

QUESTIONS 

1. What is meant by the expression “business cycle”? 

2. How often does the business cycle take place, and is it always of 
the same length and intensity? 

3. Give examples and dates of types of depression. 

4 . Explain in detail the various stages or steps of the business cycle. 

5 . What are the causes of the business cycle? 

6. Describe the effects of abnormal weather on the business cycle 
of textiles. 

7. How much effect has political influence on the business cycle? 

8. ( a ) What is speculation? ( b ) Will speculation influence the 
business cycle? 

9. (a) What causes over-production? ( b ) Can production be regu¬ 
lated? (c) Give examples as applied to textile trades. 

10. Has the unequal distribution of wealth influenced the business 
cycle ? 

11. (a) What causes the rise and fall of profits? (6) What effect has 
this on the business cycle? 

12. What effect have psychological conditions on business — pessimism 
and optimism? 

13. Name with examples some of the social effects of the business cycle. 

14 . Is it possible to have prosperity in all branches of the textile in¬ 
dustry at the same time? 

15 . What effect has fashion on the business cycle of textiles? 

16 . Explain some of the reasons why cotton has not been popular. 


582 ECONOMICS OF CLOTHING AND TEXTILES 


17. Why has the amount of wool produced and used changed from 
time to time? 

18. State some of the devices used to make silk popular. 

19. Why has rayon been popular? Has it effected the sale of other 
textiles? 

20. When one textile is popular, what happens to the manufacturing 
plants of other textiles? 



Japanese Department Store, Dairen 

Sells a number of American manufactures, and does a business of about 
$1,000,000 annually. 

















CHAPTER XIV 


TRANSPORTATION 

Importance. Originally each community was self-supporting. 
It consumed only what it produced, and it produced all it required. 
But with the division of labor and specialization came territorial 
division of product, and each district became more or less dependent 
upon the products of other communities. Today no community 
is self-supporting, because no community produces all it consumes; 
hence the necessity of a system of transportation to bring silk from 
Japan to the the mills of Paterson, cotton from the cotton fields to 
the mills of New Bedford, wool from the Western States to the 
mills of Lawrence, shoes from Brockton to Idaho, finished costumes 
and clothing from New York City to Western and Southern homes, 
etc. Transportation systems are necessary and may truly be 
considered a basis of industry. 

The Transportation System. The transportation system of any 
community, state, or country is a foundation stone of prosperity, 
for without this we have no business — we are unable to ship 
foodstuffs, wool, cotton, etc., from the farms to the cities, or finished 
clothing from the cities to the farms. Because transportation is 
so vital, local communities, states, and the Federal government 
assist as far as possible in keeping the transportation facilities in 
excellent condition. The government has in the past stimulated 
the growth of transportation by grants of land and money, and 
naturally both state and national governments exercise more or 
less control, through supervision by the Interstate Commerce 
Commission and Transportation Board. 

During the early days of the government, a large number of 
railroads and other facilities of transportation were begun, and 
these have naturally grown until today there are many rival facili¬ 
ties which tend to develop undesirable competition, eventually 
eliminating some of them. The government discourages the devel¬ 
opment of excessive competition in transportation because it is 

583 


584 ECONOMICS OF CLOTHING AND TEXTILES 


wasteful. A monopoly of transportation is desirable from a social 
point of view if it is supervised by the government. What has 
been said in regard to transportation applies equally well to other 
public utilities, such as water, gas, electricity, power, etc. Such 
monopolies should exist only under government supervision. 

Out of the activities of exchange came the development of all 
forms of communication — telephone, telegraph, radio, mail serv¬ 
ice, etc., as well as forms of transportation — in the attempts 
rapidly to transfer goods from producers all over the world to the 
consumers. All of these agencies are productive agencies (of wearing 
apparel and other commodities) because they increase the produc¬ 
tion of wealth by conveying goods to the consumer. They give 
place utility. Hence these agencies, from an economic point of 
view, should be efficient. A study of some of the principles under¬ 
lying transportation should naturally be part of a course on the 
economics of clothing and wearing apparel. 

Under our system of division of labor not only is each worker 
a specialist in some branch of industry, but each community is a 
specialist in some branch of production and is not self-supporting. 
It depends on neighboring communities to supply some of its needs 
through the system of exchange. This requires an effective system 
of transportation, so that the commodities may be quickly and 
safely transported from one community to another. 

Types of Transportation. The first effective system of transpor¬ 
tation in this country was by the rivers and waterways. Thus we had 
the shipping of bales of cotton on the boats of the Mississippi River. 
Then came transportation by covered wagons. With the develop¬ 
ment of the country, railroads were established as early as 1830. 
The first railroads were to meet the convenience of a city and its sur¬ 
rounding towns ; next the various cities were connected ; followed 
by trunk lines and transcontinental lines connecting coast-line cities 
and ocean-to-ocean cities. They have developed to a point where 
the vast system of railroads is absolutely necessary to society. 

Motor trucks, and finally airplanes, were developed to supplement 
the train service. Today, our transportation system is made up of 
the following facilities: (a) canal boats, ( b ) steamship lines, (c) pas¬ 
senger and freight car service, ( d ) motor trucks, and (e) airplane 
service. Each has its advantages and disadvantages. 


TRANSPORTATION 


585 


Canal boats are used for slow service, such as bringing materials 
like raw cotton from the inland towns to the larger cities and sea¬ 
port cities. The rates of such transportation are very low. Steam¬ 
ship lines are used to transport such commodities as silk from 
China, cotton from the United States to England, and to transport 
raw commodities and finished commodities in exchange between 
coastwise cities. For instance, we find raw cotton transported by 
coast-line steamers from southern ports to the mill cities of New 
Bedford and Fall River. 

Freight rates are lower on the coast-line steamers and other 
water routes than they are on trains, but the speed is much less. 
Where quick service is desired it is not uncommon to combine 
steamship and railroad service, as is done in the transportation of 
silk from China to New York. The following announcement of 
a shipment of silk will illustrate the practice: 

Carrying a total of 1825 bales of raw silk for the American market, the 
President Lincoln sailed from Yokohama, China. Of the total cargo, 
1474 bales will take the all-water route, while 351 bales will be transferred 
at the Pacific coast for rail shipment to New York. The ship will dock 
at San Francisco on March 22, and the 351 bales scheduled for overland 
shipment will reach New York on March 26. The Panama shipment 
of 1474 bales should arrive in this market on April 9. 

Part of the shipment was sent by rail at additional expense to 
meet immediate needs, while the rest that was for reserve stock 
was sent by boat at less expense. 

Transportation Rates. The service of the railroad system of 
the country is basic to the clothing and wearing apparel industry, 
as well as to other industries. If rates are too high, 'they may drive 
industries from certain localities, causing much inconvenience and 
waste, depriving many people of work, and paralyzing certain 
communities. 

While it is possible to calculate the cost of hauling one ton per 
mile during any given period, it is impossible to calculate the cost 
to the railroad of the transportation of cotton from Southern points 
to the mill cities of the North, or the cost of transportation for gray 
goods from mills in the South to the finishing plant in the North, 
and then the return of the finished cloth to the South. Therefore, 
the railroad rate of textile-clothing transportation is distance, on 


586 ECONOMICS OF CLOTHING AND TEXTILES 


the principle of the value of the transportation service to the cotton 
mill, cotton finisher, or converter. In other words, it is based upon 
what the textile industry will bear. This is the principle of monop¬ 
oly price, which is fixed at the point which will yield the largest 
return and still retain the business. Of course, such a principle 
means that there is a constant wrangling between the transporta¬ 
tion companies, the mill authorities, etc. The Interstate Com¬ 
merce Commission is appointed by the Federal government to 
hear such disputes in cases where the commodity passes from one 
State to another. The Transportation Act of 1920 permits the 
Commission to fix rates to yield the railroads from 5-J% to 6% on 
their value as determined by the Commission. The value of the 
railroad is the cost of replacement at 1913 prices. The Railroad 
or Public Service Commission of the State is responsible when the 
dispute concerns the transportation of a commodity entirely within 
a State. The dispute between railroads of the South and the Cotton 
Finishers’ Association, given at the close of this chapter illustrates 
the problem. 

Freight Rates. The railroad is the most important part of the 
transportation system and naturally requires a large investment 
— fixed capital goods — consisting of ( a ) the land it covers, ( b ) the 
road bed graded and properly made, (c) tunnels made through 
mountains and hills, ( d ) bridges built over rivers, etc., ( e ) stations 
and storehouses erected, (/) a proper system of signals, ( g ) loco¬ 
motives, cars, etc. The time it takes to lay out and equip a rail¬ 
road may extend over several years, during all of which no return 
is made on the fixed capital invested. 

Money is raised through the issue of stocks and bonds. The 
chief revenue of the railroad is derived from charges for transporta¬ 
tion services, called freight. Since the exact cost of transportation 
for each person and each commodity from place to place can not 
be established, the railroads have a theory of their own for de¬ 
termining rates, based upon the theory or principle of the value of 
the transportation service to the particular commodity carried, 
which is practically charging what the traffic will bear or what 
the service is worth. 

As a result, railroads publish the rates of passenger service from 
station to station, and rates of transportation of all commodities 


TRANSPORTATION 


587 


classified into groups, with each group at a specified rate for hundred 
pound or carload lots. These rates are spoken of as the tariff. 

In some cases, because the traffic of a particular business is unable 
to bear a higher rate, the rates are so low as to be less than the cost 
of transportation. The medium class business or traffic will 
stand a rate that will meet the cost of transportation, while 
the better class business or traffic will stand a rate above the 
cost of transportation, thus leaving a margin for covering the 
loss at low rates. 

The government regulates the rates of the railroads through the 
Interstate Commerce Commission at Washington, D. C. 

Consolidation of Railways. All through the United States today 
there are vast stretches of unnecessary rail mileage. No other 
country in the world — except Canada — has been so overbuilt. 
Not even the remarkable growth of American industry in the 
last forty years has been able to absorb this over-production com¬ 
pletely and put our surplus rail miles to work. The recent slump 
and the rise of competition, unforeseen forty or fifty years ago, 
when over-production of railroads was at its worst, have only 
served to aggravate the problem. 

The overbuilding of railroads was not limited to any one portion 
of the country. Certain parts of New England suffered from it, and 
also parts of Pennsylvania, Western New York, Ohio, Illinois, 
Iowa, and many other sections. But nowhere has the situation 
been worse than in the Northwest. 

This wasteful competition, combined with the development of 
other forms of public carriers, has done much to harm the railway 
system. Hartford, Conn., has but one railroad serving it; so has 
Providence, R. I. Compare the situation with that where there 
is either competitive rail service or a pooled service such as exists 
today between Chicago and St. Louis, between Chicago and 
Minneapolis, and between Chicago and St. Louis and New York. 
In any month, in any week, literally thousands of waste miles of 
expensive through passenger trains still are being operated in these 
services. Almost all of the unprofitable local and short-line trains 
have been plugged, but there is much wastage through the big 
ones. This is true even though at present the two chief competing 
roads between New York and Chicago are preparing to cut down 


588 ECONOMICS OF CLOTHING AND TEXTILES 

and simplify service — a saving of 3,000,000 train miles (or 
$5,000,000) a month. 

The competitive waste between roads is not entirely in the 
passenger service. Take the question of trucking. For a time the 
railroads made some attempt to meet truck competition by lowering 
rates. When the truckmen, feeling this new competition of the 
railroads, in turn lowered their rates, the rail carriers brought their 
rates down to the minimum point allowed by their filed tariffs. 
Further than this they simply could not go, because of government 
regulation. The truckmen, being free agents, had no such restric¬ 
tions. They went lower, and lost a little more money on each 
transaction. The net result was that business was given to the 
truck operators, and the railroads gained nothing. 

Some of the railroad companies in California, Texas, and Okla¬ 
homa — and in the East as well — have tried contracting with local 
trucking companies to handle local package freight on the high¬ 
way and so never letting it get inside a box-car. There has been 
recent action by the eastern roads in establishing low flat-car rates 
between New York and Philadelphia and between New York and 
Scranton, so that the bodies of loaded trucks may be placed upon 
the cars and then transferred to a fresh motor chassis at the 
terminal. These are all steps in the right direction. 

The solution lies in elimination through consolidation. Thirty 
per cent of the rail mileage of the United States brings in a bare two 
per cent of the gross revenues. There are towns, whole communities, 
whole States, that quite naturally will resent the tearing up of tracks 
and the abandonment of railroad lines. Politics will come into it. 
Yet elimination is the very thing that must be done — in fact, it 
already has been started. The Boston and Maine and the New 
Haven railroads have completely abandoned a considerable mileage 
in New England, and much more has been partly abandoned. 

The real solution of this would seem to lie, first, in rail consolida¬ 
tion, and then, elimination of trackage, consolidation of terminals, 
pooling of trains and other rolling-stock facilities. This would 
result in a more closely coordinated system of national rail trans¬ 
port (to which can be coordinated, in part at least and upon 
similar terms of regulation, air and water and highway transport), 
efficiently operated and well sold to its potential patrons. 


TRANSPORTATION 


589 


The railroads, in the interest of economy and efficiency, must 
effect more cooperation, consolidation, and elimination. The fact 
that the roads have not succeeded very well up to the present in real 
cooperation is no proof that the thing can not be done. The work 
of the American Railway Association in its car service division, and 
in its Advisory Committee in cooperation with the shippers, shows 
what may be accomplished when the proper start is once made. 
A thousand or more little matters of difference between the roads 
and their patrons, which in other days might easily have led to the 
filing of actions before the State or the Federal regulatory commis¬ 
sions, have been quietly and amicably adjusted out of court, and 
friendships have been kept which otherwise might easily have been 
destroyed. 

Competition from Motor Transportation. There has been sug¬ 
gested the consolidation of all Federal activities in connection with 
transportation into one department under a cabinet officer to be 
known as Secretary of Transport. This is a method of coordinating 
rail, motor, air, and pipe-line transportation facilities. In the 
transportation field, the distress of the rail carriers is too well 
appreciated to need restatement there. The rail system is vital to 
all our activities. Collapse of rail transport would be a national 
calamity. 

Our transportation situation has been complicated in recent years 
by development under government encouragement of water ways; 
by pipe lines; by the unprecedented expansion of motor vehicle 
haulage; and, in lesser measure, by the development of air transpor¬ 
tation. Each of these is a potential competitor of rail carriers. 

The motor bus and motor truck are modern facilities with 
advantages and benefits to which the general public is entitled. 
The public right in this direction, however, may not prudently be 
exercised to the extent of critical impairment of the rail system. 
To bind the latter with stringent regulation, while imposing no 
restraints on motor vehicle haulage, is to act so that a public right 
may be exercised even though it destroys a national necessity. 

In the first place, an appraisal of the effects of competition is 
made extremely difficult by rate-cutting tactics resorted to by the 
railroads to retain business on their lines. In the Southern Rail¬ 
way’s own territory, for example, competition of motor trucks is 


590 ECONOMICS OF CLOTHING AND TEXTILES 


reported increasingly effective in the carriage of certain commodi¬ 
ties, such as cotton, which have long been among the most profita¬ 
ble types of traffic for the railroads. The rail carriers, of course, do 
not sit by idly and permit this business to go to competitors. 
Instead, by cutting rates, they have been able to retain most of it, 
but the reduced revenue makes such traffic less profitable. 

In appraising the effects of competition from motor trucks, 
waterways, and pipe lines, furthermore, there may be a tendency to 
overlook more subtle developments that have had a similar effect. 
The development of hydro-electric power and the evolution of high- 
tension transmission lines to transport electrical energy long dis¬ 
tances to replace coal are cases in point. Developments of this type 
reduce the need for transportation of coal, the most important single 
item of traffic from the standpoint of both volume and gross revenue 
carried by the great majority of railways, including the Southern. 
Technological developments of this kind leave a permanent impress 
on the position of the railroads similar to that of the directly com¬ 
petitive transportation agencies. 

On the other hand, a substantial portion of the traffic lost to 
competitive agencies can be recovered with the adoption of a 
program of equalized regulation of transportation and the coordi¬ 
nation of all facilities. 

The period from 1922 to 1932 has been a critical one. The rail¬ 
roads reached their greatest period of service in 1922. Since then, 
more than 750,000 employees have been dropped. Wages have 
decreased as well. Trains have been eliminated. In 1932, 53 per 
cent less passenger-miles were being run than in 1922. Miles upon 
miles of empty freight cars and idle locomotives standing on side 
tracks all the way from the Atlantic to the Pacific tell the story 
of what has happened to the freight traffic. Thousands of railroad 
men out of work, idle shops, and low quotations on rail securities 
complete it. There were, in 1932, 23,000,000 automobiles and 
motor-buses and 3,500,000 motor-trucks traveling over the 500,000 
miles of improved highway of the United States; 10,500,000 tons 
of inter-coastal freight passing through the Panama Canal; many 
miles of airplane routes, commercial passengers making daily flights 
between New York and Chicago, between New York and Boston, 
and from the Pacific Coast to the Atlantic. 


TRANSPORTATION 


591 


But despite the rather grave inroads of the motor-truck and other 
carriers, the American railroad still continues to carry some 75 per 
cent of the freight of the land, and certain swift passenger trains 
still are well patronized. There has never been a time when a man 
could go more comfortably or in a degree of safety equal to that of 
the present moment. In 1930, out of every 100,000,000 passengers, 
only seven lost their lives in train accidents upon American rail¬ 
roads. In 1932 the record was still better. 

Many a railroad is today in a poor position to fight the motor-bus 
or motor-truck. The flexibility of both is remarkable, and often 
the economy as well. The motor-bus has its special points. In a 
dozen years it has been evolved into a swift-running and comfort¬ 
able vehicle. To its advantages are added the obvious ones of the 
clean, well-paved, modern highways over which it operates, even 
if it aids not at all in the maintenance of these highways. The 
wear and tear of these heavy vehicles upon the average state road 
is no slight matter, and a matter for which the taxpayer pays in the 
long run and generally not such a long run at that. 

But the bus is not the gasoline competitor that the railroad fears 
the most. For every man who rides in a bus upon a highway, at 
least four are riding in privately owned and operated motor-cars. 
Here the flexibility increases; the motor-car owner makes his own 
schedules, is free to come or go when or where he wills to a degree 
that makes the railroader scratch his head sadly and wonder how 
he can combat this sort of thing. A solution of the problem seems 
impossible. 

Automatically, some of the unfair advantages that the motor-bus 
and the motor-truck have over the railroad are now being reduced. 
Taxes are being raised by the various State legislatures, and are 
being readjusted to a figure which a little more nearly represents the 
great wear and tear upon pavements. Sharp restrictions against 
over-size and over-speed are being more rigidly enforced. 

Given attractive coaches and swift-running time, with the rates 
well adjusted to the needs of the situation it seeks to meet, the rail¬ 
road still has a good fighting chance to get its fair share of the 
passenger traffic, and more than this it has no real right to expect. 
The longer the run, the better that chance becomes. To this 
end many of our railroads are already moving. 


592 ECONOMICS OF CLOTHING AND TEXTILES 


More than three years ago the American railroads began to 
realize the devastation that the trucking interests, using the fine 
new public highways of the land, were wreaking upon them. 
Motor-trucks were making sad inroads upon railroad freight traffic, 
particularly the less than carload or package freight. The roads 
should have installed a pick-up and delivery system long ago, but 
they had not done so. In small towns, large trucks came, often in 
the middle of the night or very early morning, and exchanged goods 
with small trucks on local runs. Public streets and open squares 
were, and still are, used for this freight interchange, often in com¬ 
munities where the railroads long ago built large freight interchange 
stations at no small cost to themselves, and upon which they are 
paying goodly taxes in addition to sizable pay rolls. From the 
truck interchanges the average town gets nothing whatsoever, save 
wear and tear upon its roads. And only the expert highway 
engineers know how great this wear and tear really is. 

Some of the railroads themselves have made use of the high¬ 
ways as correlating factors. Many a railroad is today in a poor 
position to fight the motor-cars. In the long run, the highways 
must correlate with the railroad, not combat it. There is plenty 
of traffic for each. It takes only a fair degree of intelligence 
to discover which traffic is best suited to the different forms of 
carriers. 

In 1932, the railroads showed increasing aggressiveness in their 
effort to retain business from motor-vehicle competition, as well 
as to regain some of the traffic previously lost to roadway com¬ 
petitors. 

The New England roads have turned to store-door delivery 
without extra charge on less than carload freight. The Railway 
Express Agency, formerly the American Railway Express Co., is 
utilized for this purpose. In addition, the carriers plan to enter 
into direct competition with trucks on line hauls by truck service 
over the same routes operated by the Express Agency, which is 
jointly owned by the railroads of the country. 

The Interstate Commerce Commission has recommended Federal 
regulation of motor vehicles engaged in interstate commerce, and 
that railroad and water lines be encouraged to use the public high¬ 
ways for supplementary service in the following terms: 


TRANSPORTATION 


593 


“That transportation by motor vehicles, buses, and trucks, over 
the public highways is, within certain respects, a superior service, 
and that the rail and water lines should be encouraged in the use of 
this instrumentality of commerce whenever such a use will promote 
more efficient operation or improve the public service; 

“That there is substantial competition between rail and water 
carriers on the one hand and motor carriers on the other for the 
transportation of both passengers and freight, and that this com¬ 
petition is increasing ; 

“That such competition is conducted under conditions of inequal¬ 
ity, particularly in regard to regulation; 

“That a contributing cause, aside from the general business 
conditions of the present financial condition of the railroads, is the 
existence of unrestrained competition by rival transportation 
agencies; 

“That there is today and probably would be under normal con¬ 
ditions an excess of carrying capacity in existing transportation 
facilities; 

“That unrestrained competition is an impossible solution of the 
present transportation problem and is incompatible with the aims 
of coordination under regulation.’ 7 

Air Transportation. The Pan-American Airways has lately 
initiated a special service between the United States and the 
countries to the south that represents one of the most sensational 
developments in the history of foreign commerce. The innovation, 
introduced by Pan-Air, in combination with the Panagra and 
Scadta systems of the west coast and Columbia, consists of an 
aerial express service which allows the rapid transport of many 
articles hitherto reserved to the slower carriage of the steamship. 
The list of the merchandise which the company has already carried 
in planes includes cargoes of great variety. 

Its possibilities are limited only by the capacity of the planes 
and the relatively higher rates that are necessarily charged for 
air transport of any kind. However, urgent need or desire for a 
certain article can, when it is strong enough, easily overcome the 
obstacle of cost. 

A new air freight service has also been established between the 
Atlantic seaboard and the West. Planes carrying nothing but 


594 ECONOMICS OF CLOTHING AND TEXTILES 


freight or express now follow routes in every direction — routes over 
which some passenger air lines also carry packages. The Com¬ 
merce Bulletin of the Port Authority discloses that New York 
has become the terminal for air package services that have grown 
rapidly. 

Mail carried by air in 1932 in the United States increased 10 per 
cent, while the tonnage of express and freight carried by air jumped 
more than 200 per cent. One of the important passenger lines 
flying between New York and Washington carried 271,000 pounds 
of express in the year. Another line, with a twenty-four-hour 
schedule between New York and the Pacific coast, started a 
pick-up and delivery service handled by the Western Union 
Telegraph system. One air express company announced an over¬ 
night package service between New York and Milwaukee. 

While rates for these services vary among the different lines, 
it is possible to send a ten-pound package from airport to airport 
on the New York-Washington hop for $2, with extra charges for 
picking up the package at one end and delivering it at the recipient’s 
door at the other. At least one line eliminates the extra charge for 
service between the airport and the addresser or adressee. By an 
overnight service it is possible, for example, to have a package 
delivered in a Wisconsin town the morning after it leaves* New 
York; this may be less time than it takes for a letter to go through 
the mail from Manhattan to a suburban town in New Jersey. 

The air ferry inaugurated between the Newark airport, the 
Floyd Bennett field, and the Curtiss airport saves hours for pas¬ 
sengers or parcels changing planes in New York on the way north, 
south, or west from other cities. Certain air lines have found an 
astonishing public response to their efforts in the past year. 

Disputes. The following cases illustrate the problems that arise 
in transportation in the textile industries. 

Very few people realize the importance of textiles and wearing 
apparel to transportation as well as to the basic industries. To 
illustrate: In the finishing of cotton cloth it was found that each 
ton of gray cloth shipped to a finishing plant increases revenue 
traffic to the transportation lines more than 500 per cent by the 
additional equipment, and supplies necessary to do the work. The 
processes of finishing require the use of large quantities of heavy 


TRANSPORTATION 


595 


materials and supplies, the largest single item being fuel. The 
finishers are large consumers of heavy chemicals and of an un¬ 
limited variety of dyestuffs. They use large quantities of lumber 
for cases and paper tapes for packaging. They are large buyers of 
heavy machinery and the supplies necessary to keep the buildings 
in a serviceable condition, since the operations of finishing result 
in a very short serviceable life of much of the equipment used. 

The cost of transportation has been a very important factor in 
the development of the finishing industry in the northern district. 
With the development of railroad transportation and the cotton 
mill industry in the South, there sprang up the present system of 
commodity rates on cotton cloth movement into the northern 
district from southern mill points. This transportation arrange¬ 
ment made it possible to ship gray goods into the northern district 
to be finished and to reship the finished cloth to the principal market 
center at moderate cost. Due to the large volume of gray cloth 
moved from southern points into New England, it was possible for 
carriers to name special rates, known as commodity rates. This 
system of commodity rates, equalizing delivery costs, put southern 
mills on a parity with cloth mills located in the northern territory. 

To the extent that northern finishing plants finished southern- 
made gray goods, the northern finishing plants aided in the develop¬ 
ment of the southern mill. A sudden and violent change in the 
transportation cost would prevent the industry from readjusting 
itself to present conditions without tremendous loss. There is an 
important need for keeping the industry on a competitive parity, 
in so far as it is possible to do so through the establishment of 
favorable freight rates. 

It must constantly be borne in mind that the two rates, that is, 
the inbound rate on the raw product to the finishing plant, and the 
rate on finished fabric outbound to the principal market centers, 
should approximate equality. This is the basis upon which the 
industry grew up. It is the basis on which the northern finishing 
industry was established, and with a few exceptions it is the basis 
upon which the industry is operating today as far as eastern markets 
are concerned. 

Finishers , Disputes. Cotton finishers, that is, manufacturers 
who finish cotton cloth for the consumer, find that the textile 


596 ECONOMICS OF CLOTHING AND TEXTILES 


manufacturers in the South have an added advantage over those in 
the North. 

The following will illustrate the rate situation referred to: 

Per cent 

Present rate from southern gray mill to southern finishing plant, 
approximately.$ .30 

Present rate from southern finishing plant to Chicago, approxi¬ 
mately . . 

Total $1.13 

Present rate from southern gray mill to finishing plant in New 
England, approximately.79 

Present rate from New England finishing plant to Chicago, ap¬ 
proximately ..:§? 

Total $1.65 

Such a difference is in favor of the southern against the northern 
mills and unless converted will wipe out the northern industry. 
Hence the northern manufacturers appealed to the Interstate 
Commerce Commission to correct this difference so that the rates 
would be the same. 

Cotton Rate Disputes. In 1932 the textile manufacturers in 
central New York, and especially the Mohawk valley, appealed to 
the Public Service Commission in its inquiry into class freight rates 
for transportation of property on steam railroads within the State. 

A representative of about forty textile mills in the central part 
of the State stated that these industries which he represented were 
suffering from competition with southern manufacturers, who, he 
said, were operating under cheaper freight, fuel, power, and labor 
rates than the mills in the North. It was stated that within the 
past few years about thirty New York State mills, employing 
approximately 15,000 people, have either moved their operating 
plants to the southern States or gone out of business. He also 
stated that southern localities are offering many inducements to 
northern mills to locate there. These inducements include building 
plants, cost of moving machinery, and free taxes. 

Railroad vs. Boat Rates. Cotton-carrying railroads of the South 
have adopted rate cutting, their opponents’ chief weapon. It has 
been adopted by the roads in their determination to regain the cot¬ 
ton shipping business — mainstay of many a southern rail system. 







TRANSPORTATION 


597 


Of especial benefit to the Mississippi valley territory will be the 
newly proposed reductions on cotton moved inland to the mills of 
the Carolinas, where production of cotton goods nowadays exceeds 
the production of New England mills. 

The reductions, ranging from 20 per cent to as high as 30 and 
35 per cent have been ordered published, effective February 29, 
1932, by railroads on both sides of the Mississippi, in answer to 
independent barge and truck competition. Recently railroads 
operating west of the Mississippi agreed on a 20 per cent reduc¬ 
tion in rates of cotton shipped from west of the river in Arkansas 
and Missouri to the Carolinas, and eastern valley lines consented 
to join with them in publishing reductions. 

QUESTIONS 

1. What is meant by transportation ? 

2. State the importance of the transportation system. 

3. Explain the development of the transportation system. 

4. Why is the government interested in the development of the trans¬ 
portation system? 

6. What Federal and State agencies supervise the transportation 
system? 

6. Why should the transportation system and other public utilities 
be monopolies supervised by the government? 

7. Explain how the transportation system and means of communica¬ 
tion are the outgrowth of the activities of exchange. 

8. Explain the different types of transportation facilities. 

9. Why is an effective system of transportation necessary for the 
development of any industry ? 

10. How are transportation rates determined? 

11. Explain how duplicate systems have been built and what effect 
such a system of duplication has had on industry. 

12. Describe the wasteful effects of competition in transportation 
with motor-buses. 

13. State the recommendations of the Interstate Commerce Com¬ 
mission on motor vehicles. 

14. State the extent and also the advantages of air transportation. 

15. State some of the problems of the textile and clothing industry 
with regard to transportation. 


CHAPTER XV 


ADVERTISING AND BUSINESS ETHICS 

Importance. Advertising is a means of creating or increasing 
demands for goods and services on the part of consumers. We 
learned earlier that the scope of man’s wants and needs could be 
expanded almost indefinitely by this process of education, wish- 
creation, and suggestion. Advertising calls to mind types of com¬ 
modities — such as clothing and service to wearing apparel — that 
consumers may never have been aware of before reading the adver¬ 
tisement. 

Advertising is particularly effective in the clothing industry, 
because of the variety of wants, uses, and kinds of wearing apparel 
that can be presented. It is one of the most effective means of 
increasing the sales of clothing. 

Characteristics. Examine carefully the advertisements of 
fabrics and clothing. Notice that they bring out the characteristics 
or qualities of the product by pictures or printed information that 
appeals to one’s taste or needs. Any agency can justify itself in the 
business organization if it contributes to the increase in circulation 
of textiles from the mill to the consumer. Advertising is one of the 
most effective means of impressing the public with the value of 
textiles and thereby creating a demand for them. Most people do 
not realize the need of a fabric until its advantages are presented 
to them. These qualities are called “selling points.” 

Advertising consists of making known to the public the merits of 
a commodity so as to induce its purchase. Competition is the act 
or proceeding of independent endeavors of two or more persons 
to obtain the business patronage of a third party, by offering more 
advantageous terms or goods as an inducement to secure trade. 
Therefore the firm that presents the best advertising plea may 
secure the trade. 


598 


ADVERTISING AND BUSINESS ETHICS 


599 


35,000 YARDS OF HEAVY 


Silk Flat Crepe 


SEE WHAT YOU CAN MAKE 
FOR PRACTICALLY NOTHING: 




It's an August super 
sale price, the lowest at 
which we have sold this 
quality silk: Actually 



less than the wholesale 
cost in the present ris¬ 
ing silk market. This is 
"tried and true" silk, 
identical to the quality 
that has been selling 
right along in our 
department at higher 
prices. Over 40 colors 
including Fall shades. 


SILKS 
Sixth Floor 



There will be no 
more at this price 
when the quantity is 
gone. We suggest 
you come early to 
get a complete choice 
of colors. 


Not less than two yards to each customer 
No mail or telephone orders 


Good Fabric Advertising — Suggesting Uses 














600 ECONOMICS OF CLOTHING AND TEXTILES 


Advantages. Advertising has been developed during the last 
generation or more with the increase of business and the application 
of scientific principles to selling. 

Originally the mills that made wearing apparel were small and 
few, and the name of the mill or product, like “Fruit of the Loom,” 
was known from ocean to ocean. With the increase of the market 
came a demand for a device that would continue or increase the 
sales. So advertising in its various forms has been developed 
principally to call the attention of the consumer to the wearing 
apparel or commodity, but also to keep the name before the public, 
so that the sales will at least be maintained, if not increased. 

To illustrate: Twenty-five years ago women used cotton almost 
exclusively for daily wear. They wore cotton chiefly because it 
was sturdy and inexpensive; the fashions were not charming and 
attractive. 

A quarter century has passed. Cotton has had its ups and downs 
in public favor; but today it reigns anew. Countless thousands of 
women have rallied back to cotton. Hundreds of manufacturers, 
dressmakers, coutouriers, and department stores are designing and 
selling cottons — fashion’s favorite. 

The widespread revival finds its origin largely in the fact that 
manufacturers have concentrated on styling their cottons. Along 
with this they are introducing new methods of production and 
merchandising. They are advertising their cottons. They are 
identifying their cottons by placing their name or trade-mark 
directly on the cloth. 

Manufacturers who initiated a trade-marking policy only one or 
two years ago are already benefiting. They find that women are 
asking for their fabrics by name. Thus substitution is prevented, 
advertising is made more effective, steady all-year-round demand 
encouraged, and good will created. The picture is just as bright 
from the consumer’s point of view. Accustomed to buying almost 
everything else by brand, she depends on the trade-mark on cottons 
as a guide to quality, dependability, and price protection. 

Good, wisely placed advertising serves the double purpose of 
cheapening sales marketing and attracting new trade. The total 
volume of retail trade in 1929 was $43,000,000,000 and from census 
figures it looks as though the cost of doing business in retail stores 


ADVERTISING AND BUSINESS ETHICS 


601 


LADY 

PEPPERELL 

SHEETS 

[ Facsimile of "1 
Trade 
Mark J 

Treat yourself to the fine linen-like texture of 
Lady Pepperell, for now you can buy them at 
prices you’ve paid for average quality sheets. 
Remember every inch is woven with 4 extra 
threads to give you longer wear! Choose them 
in snowy white, solid color or with colored 
hems at these special prices. 


Three-quarter 
size, 72x108 


98 


Double bed 
size, 81x99 


C 

White Sheets 

Single or Twin Bed Sizes 

63x99.84c 63x108. 

Three-quarter Bed Sizes 

72x99. 

Double Bed Sizes 

81x108.$1.09 

Double Bed with Inner Spring 


89c 


94c 


90x108.. 

WHITE PILLOW CASES 

. $1.19 

Size 

Price 

Size 

Price 

42x36... 

.24c 

45x38?^. 

.28c 

45x36... 

.26c 

50x383^. 

.32c 


An Advertisement with Appeal to the Consumer 
Note the trade-mark. 













602 ECONOMICS OF CLOTHING AND TEXTILES 


averaged about 26 per cent of sales. This would mean that it cost 
nearly $14,000,000,000 to operate these stores. It has been esti¬ 
mated that a little over three per cent of total retail prices was 
spent during that year for advertising. 

If the same volume of goods had been marketed without adver¬ 
tising, it is safe to say the total marketing bill would have been a 
few billion dollars higher. Just think of the number of salesmen 
that would have been necessary if they had relied wholly on 
personal salesmanship. Hence one can see the economic value of 
advertising. 

The use of advertising has also been advocated in overcoming 
the slump of buying during a period of depression. The psychology 
of fear has restrained the manufacturer, the banker, and the home 
owner. Advertising can perform a great service to the country 
by creating a market of confidence which will replace the psychol¬ 
ogy of fear that underlies much of our business troubles. 

When depression reaches its advanced stages, the opportunity 
for effective psychological influences becomes especially great. 
At such times, the necessary economic readjustments have, for the 
most part, taken place; the chief restraining influence is a universal 
attitude of fear and uncertainty, based, in part at least, on vague 
and formless apprehension. It is not so much a lack of the power 
to purchase as it is a lack of the will to purchase that prevents 
recovery. 

In the course of time, the fear, like all great waves of feeling, must 
pass away ; but the reversal of the trend can be quickened by the 
timely sounding of the right note in the appeal of business men to 
their public. Advertising has made possible the astoundingly 
rapid growth of new industries by changing the living habits and the 
buying habits of millions of people. Why should it not be equally 
useful in accelerating the transition from depression to revival? 

Types of Advertising. Advertising may be classified as (a) general, 
(b) local, or (c) direct in character. General advertising is directed 
principally toward making the public familiar with the product 
and creating an impression of its excellent qualities, thus causing 
a demand for it. Most trade-marked articles which are nationally 
or internationally advertised come in this classification. Local ad¬ 
vertising is usually carried on by the retailer to call the attention of 


ADVERTISING AND BUSINESS ETHICS 


603 


customers to wearing apparel and other commodities on sale in his 
establishment, and to induce them to purchase. Direct advertis¬ 
ing may be a personal appeal to a customer, by means of direct 
mail circulars, etc., to call attention to the qualities of an article 
and to create a sale for it. 

Branded or Trade-Marked Products. If we study carefully 
advertising of the most successful manufacturers and sales agents 
of wearing apparel, we shall find that the advertising devices con¬ 
sist of the following items: (a) name of the wearing apparel, 
(b) its use, (c) composition and desirable qualities, ( d ) manufac¬ 
turer’s name, (e) selling agent’s name. 

The name of the wearing apparel is very important because it is 
the means of identifying or selecting the article. Therefore the 
name should be one that is easily remembered and associated with 
the article. 

Advertising associates the name of a firm with a textile of a cer¬ 
tain kind. In this way the good name or good will of a firm or 
fabric is established and increases the sales. The association of 
quality with certain firms is reported from customer to customer 
and from family to family and becomes part of the assets of a firm 
and is known as its “good will.” The name of the textile becomes 
the trade name or trade-mark and may be copyrighted; that is, 
the United States government will allow a firm to register at the 
Patent Office at Washington the name of a textile. If any other 
firm uses this name, it may be prosecuted in the courts and made to 
pay damages to the company whose trade-mark has been illegally 
used. 

In Chapter II we saw that trade-mark is a term used to cover 
any mark, name, or other arbitrary symbol or combination of such 
applied to merchandise to distinguish it from goods made by others 
or to designate its source. An owner may register his trade-mark 
with the government if he is a citizen, or if he is located in any for¬ 
eign country which by treaty, convention, or law affords similar 
privilege to citizens of the United States. The registration fee is 
$10 and the period of its duration is indefinite. 

Another method of distinguishing wearing apparel is through a 
registered design. A manufacturer or designer may have a design 
copyrighted if it has not been used before. 


604 ECONOMICS OF CLOTHING AND TEXTILES 


Wearing apparel on the market may be divided into two large 
classes of (1) unlabeled products and (2) products with trade-marks 
or brand names. Branded or trade-marked articles are those placed 
on the market under the name of the manufacturer or retailer. 
Some merchants do not care to sell branded merchandise, sub¬ 
stituting in many cases costumes, coats, suits, etc., bearing the 
name of the retailer and sold as his own brand or make. Other 
merchandise, without label or brand of any kind, is often placed 
on the market by retailers to increase the volume of their business. 
This practice tends toward cheap and inferior merchandise, which 
the consumer rejects after a short time in favor of branded or 
trade-marked articles. 

The importance of some identification mark on a product is 
generally recognized. Experience shows that it is desirable to 
have the manufacturer’s name on all fabrics. The maker is the 
only man who knows the exact quality. For example, only the 
Lowell Manufacturing Co. knows the kind of cotton used in 
Crown Head cloth — the treatment and twist, the selection, the 
dyeing, the dyestuff used. It places the words “ Crown Head 
Cloth — Fast Color” on every yard of selvage. With the manu¬ 
facturer’s name on the goods, you can then put the responsibility 
for the quality of cloth and dyeing on the man who knows how 
they were made. 

Throughout the entire apparel industry, from textile manufac¬ 
turer to the retail distributor, a revolt is under way against the 
making and handling of goods of poor quality. 

Abuse of Trade Names. One of the most notorious of the price 
abuses in recent times has occurred when owners of trade-marks 
continue to demand full prices at retail, and sell the products of 
their factories in non-competing fields at normal market values. 
Shirts, underwear, suspenders, handkerchiefs, and chiefly the 
products that go to men, furnish most of the examples of 
the abuse of a trade-mark in maintaining prices. When the 
cost of producing an article of wear falls fully a third, it would 
seem to be the right of the consumer to secure some benefit 
from it, but because men are notoriously unwilling to change 
garments once they become accustomed to them it is possible for 
the dealer to get the full price and absorb a larger profit. Women 


ADVERTISING AND BUSINESS ETHICS 


605 


Natural Muskrat 

$ 50 


Pelts worked chevron effect. 


v-irey ^quirr^i 

*125 


Four models of fine Siberian 
pelts. 


-Kara ku I- 

*89 

Newest styles in black or brown. 


-Karakul, Silver Fox**- 

*149 

Natural silver fox trimmed. 


pAmer. Broadtail***— 

*99 

Tan or platinum grey with notch 
collars. 


-Hudson Seal*- 

*169 

Six models, variously trimmed. 


-Hudson Seal*- 

*99 

Two self trimmed models. 


-Hudson Seal*- 

*199 

Trimmed with silver fox. 


-Leopard Cat- 

*119 


Three smart new models. 


-Alaska Seal- 

*279 

Three models of finest quality 
U. S. Government pelts. 


-Dark Raccoon- 

*119 

Deep shawl collars. 


-Dark Mink- 

*575 

Dark pelts. Two new models. 


A small deposit will hold your furs until November 1 
and you may pay the balance in weekly or 
monthly payments until then. 

*Dyed Muskrat **Lamb or Kid ***Processed Lamb 
A Deceptive Advertisement 

Note the large type for the name of the fur and the small type in foot¬ 
note showing that these are substitutes for the standard furs. 



























































606 ECONOMICS OF CLOTHING AND TEXTILES 


have learned how to stop buying trade-marked lines when they are 
overpriced. 

Successful Advertising. The success of advertising depends 
upon securing the confidence of the reader. Hence, a false state¬ 
ment or a misrepresentation in the advertisement arouses suspicion 
of the merit of the wearing apparel and causes loss of interest in 
the article, as well as a loss of sale by failure to create a desire. 

The advertising should be conducted according to definite prin¬ 
ciples, as outlined in Chapters II and III. A careful study of the 
possible markets for the wearing apparel is also necessary, and a 
knowledge of the means or medium of reaching the consumer or 
the market. 

The advertising should be well written and displayed objectively 
to attract attention, to arouse interest, and to bring out the 
qualities of the wearing apparel so as to create a demand in the 
reader’s mind for the article. The success of the advertisement is 
determined by the demand created. 

A check should be placed upon advertising to see if it is effective 
and pays. A definite program should be planned — the field to 
cover, the number of people to be reached, the results to be ob¬ 
tained, the cost of the advertisement, etc. Return coupons for 
samples or advice are excellent methods of checking the success of 
an advertisement. 

The initial expense for advertising is great, because of the 
large space required at first, but this may be gradually reduced so 
that the product is kept continuously before the public. 

Spasmodic or occasional advertising is not successful. Con¬ 
fidence is developed in advertising only by its continuous use, 
except in the case of seasonal wearing apparel. Regularity in 
advertising gives an impression to the consumer of stability and 
permanence which will be associated not only with the product 
but also with the firm. 

The cost of advertising is measured in terms of what you get for 
the money paid for it. To illustrate: A page advertisement in 
four colors in a popular magazine costs $16,000. The magazine 
has something of interest to every family, such as thrilling stories 
from real life, dramatically illustrated, and interestingly told. It 
reaches 5,500,000 families. The cost of a page at $16,000 that 


ADVERTISING AND BUSINESS ETHICS 607 

reaches 5,500,000 families is one-third of a cent per family. This 
rate is considered very reasonable. 

Arousing Attention. The chief means of arousing attention in 
an advertisement of wearing apparel is through some attractive 
picture or illustration in colors, and a prominent place or position 

Before a newspaper can sell goods for 
an advertiser it ought to be able to sell itself . 

It hasn't done that when it goes back 
while the population in its own com¬ 
munity increases by 409,541 families 
55 per cent. 

When a newspaper trims, ignores the 
needs and interests of its community, 
cuts down on news, the public soon 
catches on. 

The Times doesn't starve its news 
columns. It has not slashed its news 
service. It continues to send its trained 
reporters with the Sox and Cubs when 
they play out-of-town games. It contin¬ 
ues to maintain the best staff of corre¬ 
spondents in every foreign country of 
importance to readers. 

An Advertisement of a Newspaper to Attract the Textile 
Trades 

with strong head-lines, followed by short, concise, forcible sentences 
in easily read type. 

The pictorial phases of the advertisement may consist of either 
(o) a picture to secure attention and arouse interest in no way 
related to the advertisement, or (b) an illustration showing the 
character or uses of the wearing apparel, etc. Of course, the 



608 ECONOMICS OF CLOTHING AND TEXTILES 


illustration of uses is usually far more effective than the mere 
picture. 

Advertising of wearing apparel appeals to the emotions of the 
reader. It has sometimes been abused by extravagant terms, cheap 
appeals, etc. It is desirable to keep the youthful spirit in adver¬ 
tising ; by all means keep it gay, happy, cheerful, dramatic, and 



Display of Dummies Artistically Arranged 


entertaining, but make it informative as well, and helpful to the 
buyer. It is necessary in some cases to improve its manners and 
taste and to reduce its units to type and illustrations that belong 
in newspapers and magazines and not on billboards. 

Advertising Space. The position of an advertisement has much 
to do with its success. The space in which an advertisement will be 
read by the largest number of people who are possible purchasers 
of the wearing apparel commands the highest price. The back 
cover of a magazine and the second page inside the cover are 
desirable and hence expensive. 

The reading or text matter of an advertisement is called copy. 
It should state the characteristics of the wearing apparel that are 
essential for the consumer to know in order to create a demand for 
the article. These are known as selling points. 

The reading or text matter should be written so that the con¬ 
sumer with the least education or power of comprehension can 
understand. As suggested in Chapter II, appeal to the senses 
is the most effective appeal to those with the least power of com¬ 
prehension. 




























ADVERTISING AND BUSINESS ETHICS 609 

The appeal must be such as will require as little thinking as 
possible, but will at the same time create a desire on the part of the 

COLLAR-ATTACHED SHIRTS 

Collar-attached shirts for general wear are 
cut on our own generous pattern and made 
in our workrooms from materials of 
our own importation or selection. Conse¬ 
quently they are different in appearance 
from the ordinary—and have been found 
to have extraordinary wearing qualities. 

In cheviot, for instance, they are made in 
white and seven plain colors: blue, tan, 
stone, brown, pink, green, and yellow. 

Scotch cheviot . . $ 4.00 and $ 4.50 

Domestic cheviot in plain 

white and plain blue only . . $ 3.25 

An Attractive Advertisement for the High-Grade Consumer 
Who Wants Style and Service as Well as Price 

consumer. This is usually done by appealing to his selfish interests. 
In the case of wearing apparel, it is to the love of distinction — 
something to make one appear to better advantage, to cover up 
some defect, or to bring out some strong point. 




610 ECONOMICS OF CLOTHING AND TEXTILES 


For the person with a minimum power of comprehension, repeti¬ 
tion is very desirable — repetition not only in the same way, but 
also in different settings. 

Retail advertising should be adapted to the location of the 
store and the class of customers as well as to the product. To 
illustrate: Advertising and displays on Fifth Avenue should pre¬ 
serve the dignity and high character of the midtown shopping sec¬ 
tion. Certain stores have cheapened the character of the section 
and have had an adverse effect on rental values, because of their 
use of placards, posters, and stickers on their windows and doors, 
ballyhooing the depression with half-price sales and liquidation 
announcements. Thus they thwart the efforts that have been put 
into the development of the Fifth Avenue section during the last 
twenty-five years and undermine the confidence of shoppers and 
arouse a distrust of all advertising. 

Varieties of Appeal. The appeal of an advertisement of wearing 
apparel varies according to the principles laid down in the discus¬ 
sion in Chapter II. Objective appeal is stronger than the appeal 
of the printed word. Hence, we might list the various appeals in 
the following order: 

1 . The strongest appeal of wearing apparel is when it is seen 
worn by a person with grace and an attractive personality. This 
method best displays the style and service values of the clothing. 

2 . The next most effective appeal would be a wax model of 
stylish proportions, with the clothing arranged in an effective 
manner. 

3. Clothing displayed in a show case or window on a properly 
built stand. 

4. A model of the wearing apparel in composition. 

5. A picture in color showing a stylish person wearing the clothing. 

6 . A picture in black and white. 

7. Reading matter in color and various sizes of type. 

8 . Reading matter in black and white. 

Advertising Mediums. The method of advertising, that is, the 
medium or means of advertisement, is very important. A study 
must be made of the wearing apparel to be advertised and the kind 
and class of people to be reached. To illustrate : One manufac¬ 
turer may wish to sell direct to consumers, others to druggists, 



ADVERTISING AND BUSINESS ETHICS 611 

chain stores, jobbers, wholesalers, hotels, etc. Therefore the 
advertisement should be planned, and printed in the medium that 
is read by the most people to whom the advertisement is expected 
to appeal. 

There are various methods of advertising wearing apparel: 
(a) outside or street-window displays, (6) inside window and 


Artistically Displayed Costumes for Athletics 

counter displays — form displays, etc., (c) giving away samples, 
(d) demonstrations in stores or public places, ( e ) newspaper adver¬ 
tising, daily and weekly, (/) advertisements in magazines of differ¬ 
ent kinds that circulate among different classes of people that may 
use the wearing apparel, etc., ( g ) programs, ( h ) street-car adver¬ 
tising, (i) highway or billboard display, ( j ) radio, ( k ) electric sign, 
(Z) sky display, (m) catalogues, (n) direct mail advertising, etc. 

Experience will show and observation on Fifth Avenue will show 
that practically every one will look at a good window display of 
wearing apparel, and sometimes as many as one out of four or five 
who look at the display will buy. 

Haberdashery is the most important part of wearing apparel 
for a man. The framework of the face consists of the collar, necktie, 














612 ECONOMICS OF CLOTHING AND TEXTILES 


and shirt, and since the center of a person’s vision is the face, the 
framework either adds to or detracts from the impression made by 
the face. - J 

Newspapers. The newspaper affords one of the most effective 
forms of advertising. It has been estimated that as much as $75,000- 
000 has been spent in a year in newspaper advertising, and that at 
least one-quarter of it has been devoted to wearing apparel. 

Newspaper advertising is a necessity for corporations and indus¬ 
trial concerns in the successful development of their business. The 
objective of industrial concerns involves making what the public 
wants or can use to advantage; making it so well that it will give 
satisfactory service; advertising it and selling it; providing the 
necessary engineering service if it be a commodity which requires 
that; guaranteeing its quality; then developing something better, 
and so on ad infinitum. 

Newspapers have an important bearing on the relations of an 
industry with the public. Advertising is, of course, the first and 
most direct means of impinging on the consciousness of the news¬ 
paper reading public. The press is of outstanding importance in 
the public relations work of most manufacturers, as it supplies 
thousands of highly selected audiences to which any manufacturer 
may address himself provided he has anything worthwhile to say. 

Adequate public relations work will win institutional recognition 
for a company; but it is never a substitute for advertising. To 
employ public relations methods without effective advertising is 
like driving an automobile with a defective steering gear — you 
can get somewhere, but not where you want to go. 

A recent investigation shows that of a representative group of men 
51 per cent read books on an average of slightly less than one a 
month, 74 per cent read books an average of twenty-five minutes a 
day, and 98 per cent read newspapers an average of forty-five 
minutes a day. This applies to rural as well as metropolitan areas, 
the study asserts, citing an investigation of representative farm 
homes in which newspapers were read 100 per cent. 

While books and magazines vary from 100 per cent to 20 per cent 
in popularity, according to the education of the reader, newspapers 
never fall below 90 per cent. The range is from 100 per cent among 
those with less than eighth-grade training. 


ADVERTISING AND BUSINESS ETHICS 


613 


An authority on newspaper reader interest says that cartoons, 
comics, and pictures hold the greatest attention, with sports news 
ranking first in reading matter. On the other hand, a survey made 
in 1932 by the Inland Daily Press Association reports that men’s 
interest in the contents of a newspaper ranks in this order: local 
news, general news, comics, pictures, sports, markets, weather, 
editorials, society. The pamphlet issued by the bureau points out, 
after quoting the results of these surveys, however, that men’s 
interest in the news may vary greatly according to occupation. 
A representative group of business men placed the financial 
page first in interest and editorials fifth. On the other hand, 
a group of professional men ranked finance fifth and editorials 
second. 

Variations due to locality are also apparent, a comparison of read¬ 
ing habits of business men in two cities showing local news ranks 
first with one group and seventh with the other. 

Of a group of 100 single men it was found that only 17 spent 
an hour or more a day reading newspapers, the majority spend¬ 
ing five to thirty minutes. Of 100 married men it was found that 
57 per cent read the newspapers for an hour or more, while 80 
per cent read them from thirty to sixty minutes. 

Sixty-four per cent of the men read advertisements, the bureau’s 
pamphlet continues. “Men not only read newspapers but live 
by them,” the study concludes. “They read newspaper adver¬ 
tisements and buy the advertised products.” 

Examine the newspapers of small and large communities and note 
the advertisements of wearing apparel. Also note the following 
characteristics of newspapers: 

(a) The local paper is read in almost every family, hence it is an 
excellent medium for local merchants to use in advertising wear¬ 
ing apparel, etc. 

( b ) Daily newspapers are kept in a home for a day, may be 
read quickly by the men, more leisurely by the women. Little 
time is given to reading advertisements, so they should be simple, 
direct, with cuts of specialties, and not cover too many specialties 
in one day. 

(c) The price of one of the specialties should be very attractive, 
in order to draw consumers to the stores. 


614 ECONOMICS OF CLOTHING AND TEXTILES 


(d) Papers differ in their readers. Some appeal to workers, 
others to leaders and the wealthy. 

Magazines. Examine the monthly magazines and weekly peri¬ 
odicals of general character and note the following characteristics 
of the advertisements of wearing apparel: 

(а) Character of paper — excellent quality — allowing for excel¬ 
lent illustration in color, etc. 

(б) People read or allow a magazine to remain on the table or 
stand from one to two months. 

(c) Large circulation among the general public over the whole 
country, hence an excellent medium for creating a general demand 
and used by manufacturers of wearing apparel for that 
purpose. 


If You Reduce 
The Quality of Your Cloth 
Or Your Production 
By Even a Small Percentage 
By Using Substitute Repairs 
Or Bobbins or Shuttles 
Not Made By the Builder 
Of Your Looms 
You Will Lose More Money 
Than You Will Save 
Think This Over 
Check It Up 


aw 

aw 

aw 

aw 

aw 

aw 

aw 

aw 

aw 

aw 

aw 

aw 


aw 

aw 

aw 

aw 

aw 

aw 

aw 

aw 

aw 

aw 


m 

&w 

aw 

aw 

aw 

aw 

aw 

aw 

aw 

aw 

aw 

aw 

aw 

aw 

aw 

aw 


Good Advertisement in a Trade Journal 
An appeal by logic to mill manufacturers in favor of standard loom parts. 


ADVERTISING AND BUSINESS ETHICS 


615 


(d) People read magazines in their leisure, hence they are read 
carefully and the contents considered. 

(e) Magazines vary in prices and hence each one is read by people 
of a definite income or standard of living. 

Trade Journals. Examine trade journals and note that prac¬ 
tically each specialty of wearing apparel has a separate magazine 
called the trade paper. Note the following characteristics: 

(а) Circulation is small compared to magazines. 

(б) Readers are intensely interested in the trade gossip, prices, 
supplies, cycle of business, etc. 

(c) Hence advertising in a trade magazine will reach every one in 
the trade buyers, wholesalers, and jobbers, who of course come 
in contact with the consumers. 

Mail. Note the advertisements that pass through the mail 
with regard to wearing apparel. They usually consist of a letter 
or booklet arranged so as to attract attention, and are printed in a 
simple, concise form, setting forth the selling points of the wearing 
apparel. These booklets are very effective, especially when fol¬ 
lowed by personal letters. 

Many manufacturers of wearing apparel publish an advertising 
device called a house organ. It is attractively arranged and is 
adapted to (a) agents, ( b) salesmen, (c) consumers, and ( d ) dealers. 
Not only is information of a general type provided, but special 
articles on salesmanship, etc., are offered. Since most people judge 
an organization or writer by the character and style of the printed 
papers, the “make-up” is important. 

Mail-order advertisement is the result of the recently developed 
mail-order business in wearing apparel. The advertising should 
consist of catalogues and follow-up letters, attractively arranged, 
containing the selling points. 

Other advertising devices, such as calendars, novelties, handbills, 
blotters, and free samples are used in advertising wearing apparel. 

Street-car and bus advertising is very effective. 

Outdoor advertising, such as posters, signboards, and electric 
signs, is sometimes used for wearing apparel. 

The roadside advertisement to be good must be popular with the 
public. It must be attractive and properly located. The move¬ 
ment for roadside beauty should not cause advertisers to lower their 


616 ECONOMICS OF CLOTHING AND TEXTILES 


standards because of economic depression. While large invest¬ 
ments are involved in the outdoor advertising business, it should 
be confined to commercial districts and not disfigure roadside 
beauty spots. 

The manner in which textiles and wearing apparel are arranged 
for sale and for display is very important. The first impression 
made by wearing apparel is from the manner in which it is displayed, 
which also includes the method by which it is arranged or packed 
for delivery — called packaging. Each of these may or may not 
arouse our interest and hold attention. Hence the importance of 
proper display and packaging of textiles and wearing apparel as a 
means of advertising, arousing our curiosity so that a desire to 
purchase is created. 

Packaging. Primarily textile packaging is for a utilitarian 
end — to protect the goods on their journey to the place where 
they are to be put to use. When suitably decorated, however, the 
packaging attracts the user to the goods and acts as a silent sales¬ 
man to carry ideas of style, quality, standardization, etc., to the 
prospective consumer on sight. Even utilitarian packaging, such 
as is used in inter-industry shipments of yarn and piece goods, is 
coming to have a character designed to distinguish and render more 
desirable the particular materials so put up. 

Packaging of textiles may be divided into two major groups: 
(1) for inter-industry shipments, that is, from one manufacturer 
to another; and (2) for delivery into the hands of the ultimate 
consumer across the retail counter. 

The first group comprises principally yarns and piece goods. 
In yarns, one of the most careful jobs is being done by rayon manu¬ 
facturers, many wrapping their cones in waxed paper suitably 
branded on the outside, and one or two have been using other 
suitable material such as cellophane. Careful wrapping here not 
only guards the yarn against abrasion and soiling, but aids in 
retaining the original moisture content. 

Piece goods wrapping for inter-industry shipment is usually a 
simple affair. Except in the finer lines, there is usually no wrapping 
at all, the pieces being shipped in bales or paper-lined cases. In the 
finer-materials field, such as silk, it has been found worth while to 
wrap every piece shipped in paper of a distinctive light green shade, 


ADVERTISING AND BUSINESS ETHICS 


617 


which serves not only to protect but to distinguish and identify the 
goods in the stock rooms of cutters or jobbers. 

Finishers also have developed distinctive packing. One dye 
works, for example, wraps piece goods in 60-lb. paper, usually dark 
blue, and fixes a 1^-inch diameter disk of the material itself at the 
end of the package for ready identification on the shelf. This 
company delivers sample headends in cellophane envelopes, and 
tissue paper is used between the folds of napped fabrics. Of 
course, finishers generally will follow their customers’ instructions 
on put-up, using customers’ boards, bands, labels, and tags, when 
requested. Simplicity, however, must be the rule for commercial 
work. A package which will unpack with maximum speed and 
facility gets preference. 

There has been little progress in packing raw materials, although 
efforts along practical lines have wrought a few changes. Cotton 
fabric baling for raw cotton has gained many adherents in the last 
18 months of abnormally low cotton prices. Wool fabric pack 
for raw wool has not made such headway, largely due to the 
added cost, though absence of broken vegetable fibers in the 
wool so packed is a strong selling point to some mills. Better 
packing of raw silk has been forested by the United States Testing 
Co., and a new put-up, involving protective wrapping of water¬ 
proof paper and cloth under the usual matting covering, has 
been developed. 

So far we have been talking about the work clothes or business 
dress of textiles. Considerations in selecting such raiment are 
practical and relatively simple. It is the party frock that gives 
chance for subtle embellishments to set forth the human contents 
to best advantage and to display personal charm most effectively. 
“The party frock” of the textile product is the box or wrapping 
which takes it to meet the consumer. 

Sale has usually been made to the commercial buyer before the 
goods are delivered to him. The goods rather than the packing 
make the sale. With the ultimate consumer, sale is usually not 
accomplished until the goods have been seen. Method of presen¬ 
tation to the consumer, therefore, is a most important element 
in closing the sale. In this field of consumer packaging there is 
full scope for the skill of the salesman, psychologist, artist, and 


618 ECONOMICS OF CLOTHING AND TEXTILES 


package manufacturer, and it is here that the most distinctive 
achievements are to be found. 

Mills which turn out finished consumer products are naturally 
those that are outstanding in this class of packaging. These 
include the majority of hosiery, underwear, and knitted outerwear 
mills, along with makers of sheets, pillow cases, bedspreads, towels, 
etc. In a general way there has been a turn from the jazzy pack¬ 
ages of a year or two ago to more conservative, quality-suggesting 
containers. Transparent wrapping materials have played a prom¬ 
inent part in current developments and are used effectively either 
alone or in conjunction with boxes. Elaborate containers for sheets 
and pillow cases have been on the market, reaching a climax in one 
company’s box of polished aluminum with mirror cover. In the 
standard form of boxing these items, the arrangement permits 
the tying of the pillow cases inside the cover so that when opened 
both pillow cases and sheets are at once on display. Such packing 
is used principally for colored sheets or otherwise highly styled 
items, the sale of which is aided against competition of lower- 
priced staples by the attractive setting in which they are offered. 
A towel mill makes an attractive cellophane packing of its towel 
and bath-mat sets. 

Hosiery boxes containing three pairs have become a popular item. 
Retailers prefer box selling, as it means cleaner stock, easier identi¬ 
fication, and simpler stock control. Low-priced hosiery, which is 
a table item with many department stores, does not call for the de 
luxe treatment of higher-priced goods. A line of folding boxes has 
been offered for hosiery, which can easily be made into set-up boxes. 
These appeal through economy of storage space for reserve supply. 
Harmonizing hosiery bands and box decoration is done in attrac¬ 
tive arrangements. Underwear is now on the market in cellophane 
envelopes on which successful printed effects have been produced. 
Such packing for shirts, drawers, etc., means fewer markdowns of 
shop-worn stock. 

A report on the paper-box industry shows a well-maintained 
business which indicates increasing use of shipping and merchan¬ 
dising packages. The industry has been operating recently on an 
average of 75 per cent of its capacity. Failures have been very 
few, only six reported for 1931 out of a total of 1250 establishments. 


ADVERTISING AND BUSINESS ETHICS 


619 


Trade in paper boxes in 1931 declined 24 per cent from 1930, a loss 
divided as follows by a box manufacturer: 12 per cent to trans¬ 
parent wrapping materials, 8 per cent to wood, 3 per cent to glass, 
and 1 per cent to other forms. New business is described as 
encouraging, based chiefly on the reason that attractive boxes have 
been found to be sales builders by the industries which use them. 

Theory. The philosophy of style in packaging has been outlined 
by Irma Marohn, packaging stylist: 

1. Shape. Suitability of shape to contents; distinction; con¬ 
venience of shape to use; convenience of size for use; not too high; 
not too wide. The shape may be tricky if it adds utilitarian 
advantages, but obvious trickiness only for the sake of being clever 
is not enough. Whatever the shape it must pack well, without 
waste, for shipping, and should be economical of paper board 
stock and production cost. 

2. Design should describe the contents, if possible, and strive 
for pleasing simplicity by subordinating the design to the message to 
be conveyed. All the message that is really needed is the name 
of the product, if it is well-known, or if the name is not sufficient 
description, some phrase which describes the contents, plus the 
manufacturer’s name. 

Extreme modernism is not recommended for designs of nationally 
advertised and standardized packages, since such designs would 
become outmoded too soon. A good package should include the ele¬ 
ment of timelessness. A well-designed box will tell the same story 
or present the same central theme on the front and back panels 
and, if possible, on the two side panels as well. In devising a 
package family tie-up, the same design or a repetition of a central 
theme may be carried through logically, starting with the design of 
the individual package, the display container, probably a display 
stand, and finally the corrugated or fiber shipping case. 

3. Typography. The lettering should be simple. The use of 
distinctive but not freakish identifying lettering which is in keeping 
with the design and character of the contents is a requisite. Inter¬ 
locking letters, scrolls, and the use of too many type faces detract 
from legibility and simplicity. 

4 . Color. Full realization of the value of color has come only 
in comparatively recent years. Freshness is an essential part of 


620 ECONOMICS OF CLOTHING AND TEXTILES 


the appearance of modern successful packages. Color should be 
appropriate and indicate the contents of the package if possible. 
Unusual and more subtle background colors will attract attention 
in contrast with the orthodox reds, yellows, and blues. In de¬ 
signing display containers wherein the individual carton is of 
great vividness, the use of a cool neutral color such as gray-beige 
or gray-green will be useful in providing contrast. 

The first step in designing a new package is to survey the field of 
packages with which the new container will be called on to compete. 
The character of the colors which are vying with it for attention 
must be noted. The new package should predominate in its field. 

Cooperative Advertising. In order to avoid waste in advertising, 
it has been suggested that a cooperative scheme of industrial adver¬ 
tising be adopted. An example of such cooperative action is given 
by the Cotton Institute. 

The cotton industry, by way of demonstrating its recognition of 
the need for consumer advertising, has for several years through the 
Cotton Textile Institute been engaged in an industry-wide cam¬ 
paign. In 1932 a sizable fund was subscribed for conducting the 
special promotional effort incident to National Cotton Week. 
Advertising in the trade press, direct mail announcements, posters, 
and other dealer-help material were provided in generous measure 
by the fund. Retail stores, which have always cooperated whole¬ 
heartedly with the central promotions of the Institute, for that 
week participated to an even greater extent than before. 

It is estimated that during the period May 16-21, inclusive, 
department stores, specialty shops, and other retail distributors 
spent close to $2,000,000 in stimulating the sale of cotton mer¬ 
chandise. The greater part of this sum was used for newspaper 
advertising. 

The real significance of these efforts to increase the sale of cotton 
goods through advertising and publicity lies in the industry-wide 
cooperation involved. It is made possible by the joint effort and 
financial support of cotton farmers, brokers, manufacturers, finish¬ 
ers, converters, selling agents, wholesalers, and retailers. 

The summary of preparations by merchants and chain organiza¬ 
tions for National Cotton Week shows that close to 25,000 depart¬ 
ment stores, men’s and women’s apparel shops, drug stores, shoe 


ADVERTISING AND BUSINESS ETHICS 


621 


shops, grocery stores, and variety stores made cottons the object 
of an intensive selling campaign, the benefits of which were felt 
throughout the entire summer. 

For example, the Southern Railway set aside a page for National 
Cotton Week in the new issue of its time tables distributed early in 
April. Similarly many manufacturers of nationally known prod¬ 
ucts featured the official symbol in their advertising and other 
promotional material. 

About 75,000 National Cotton Week display posters in red, white, 
and blue were prepared for distribution to the trade. Symbolic 
of the public’s recognition of cotton as “the universal fiber,” the 
poster design carried an outline map of the United States over 
which was superimposed a cotton stalk with four bolls. The color 
combination was selected in keeping with the current Washington 
Bicentennial celebration. The Institute also furnished merchants 
and others concerned with a broadside of suggestions for advertis¬ 
ing and display of all kinds of cotton textiles. 

The following comment was made by one of the organizer’s 
of this plan: 

National Cotton Week this year is of unusual significance. It repre¬ 
sents an aggressive effort throughout America to stimulate greater business 
activity in a commodity of everyday use and of world-wide importance. 
Obviously any increase in the demand for cotton products will be of 
direct benefit to 12,000,000 people whose livelihood is dependent upon 
the growth, manufacture, or distribution of cotton. Judging by the 
initial reaction of the-retail dry goods trade, which last year spent $1,500,- 
000 in launching this event, the promotion of National Cotton Week 
in May should play an important part in the nation’s reconstruction 
program. 

Cooperative advertising has proved particularly valuable in 
such fields as savings banks. These banks have had considerable 
difficulty in accepting the advertising idea, largely because there 
is so little available out of the earnings of a bank for advertising 
purposes. The value of cooperative advertising, particularly 
from the point of view of the smaller savings bank, is thus 
apparent. 

There are certain disadvantages in cooperative advertising, how¬ 
ever. In the first place, it is devoid of the personal touch, and 


622 ECONOMICS OF CLOTHING AND TEXTILES 


loses in effectiveness by reason of the. very fact that it is group 
advertising. Therefore, many manufacturers desire to support 
both types of advertising: the cooperative to call attention in a 
general way to the value of their products, — such as cotton, 
and to supplement this campaign with personal advertising of the 
products of their own mills. 

Style Promotion. The subject of styling of wearing apparel 
is now conducted on a scientific basis. The present styles are 
the result of a conference of stylist, manufacturer, and selling 
force. The use of such a styling feature in advertising and sales¬ 
manship is illustrated by the following outline: 

The function of the stylist is to produce a line so fashion-right 
that it will sell. 

The stores are buying on style and advertising on style, and the 
consumer in turn purchases on style. What more logical than to 
sell on style? And this is just what style promotion aims to do. 
It brings the manufacturer in contact with style sources. It 
presents the line to these sources in the fashion-right way. A 
manufacturer may have the finest cloth in the land, but unless 
the style outlets, the ready-to-wear manufacturers, know about 
it, it is going to pile up around the mill. Or if it reaches the 
stock rooms of the garment manufacturer, it is going to remain 
there unless some one promotes it. It must be brought to the 
attention of the ready-to-wear manufacturer by some one who can 
give him authoritative style reasons why he should buy it and 
explain how he, in turn, can sell the garments made of it to advan¬ 
tage. Even then it must be nursed and followed through to 
ultimate consumer acceptance. 

In just the same way it must be brought to the direct attention 
of the stores, not only for the piece-goods departments, but for 
the ready-to-wear, upholstery, and any other departments where 
it can be sold. In these days of ensembles — ensemble present¬ 
ments, ensemble selling, and ensemble buying — every product 
must be coordinated. Coordination of merchandise is, then, 
another factor in style promotion. 

Then there are the many ways in which the product can be and 
should be brought to the attention of the consumer in order to 
create a consumer anticipation and interest to be translated into 


ADVERTISING AND BUSINESS ETHICS 


623 


a buying urge and quick acceptance. This may seem to encroach 
on the functions of publicity, but publicity and merchandising are 
closely intertwined and necessarily even more intimately con¬ 
nected in style promotion. 

This style promotion must be undertaken by some one who 
understands conditions in the ready-to-wear industry, who is 
familiar with the policies and working methods of the retailers, 
and who has close contacts with the channels leading to consumer 
acceptance. 

The advertising agencies are realizing the vital need for this 
style-promotion service. All large textile houses have a style- 
promotion department. 

Business Ethics. The Federal Trade Commission was author¬ 
ized by the United States in 1914 to prevent unfair trading, 
enforce anti-trust laws, and investigate commercial procedure. 
It consists of five members appointed by the President for a term 
of seven years. 

The chairman of the Federal Trade Commission stated recently 
that an increasing number of applications for investigation of 
alleged unfair practices were being received by the Commission. 
He attributed this development to the pressure of competition 
during a period of depression. The explanation seems reasonable, 
since an honest man is naturally more vigilant in detecting and in 
trying to protect himself against the unfair practices of his rivals 
when business declines, while the dishonest man has a greater 
temptation to indulge in unethical practices. 

Preliminary inquiries pursuant to applications for complaints 
made to the Commission during the first eleven months of 
1931 totaled 1524 as compared with 1271 for the same period 
in the preceding year. These statistics show that the con¬ 
ditions give rise to fraudulent advertising and selling practices, 
and encourage the activities of “false traders, fakirs, and 
impostors.” 

The Federal Trade Commission is constantly regulating the use 
of untruthful representation in advertising, labels, etc. Resolu¬ 
tions clarifying the differences between pure dye and weighted 
silks and providing for the truthful designation of such differences 
in invoices, labels, marks, representations, and advertising were 


624 ECONOMICS OF CLOTHING AND TEXTILES 


unanimously adopted in 1932 at a conference of broad silk mer¬ 
chants and retailers held under the auspices of the Federal Trade 
Commission. The following resolutions were advised: 

Mixed goods or goods containing silk and other fiber or fibers shall 
not be designated by a designation containing reference to silk unless 
there be added to such designation some qualification which shall reason¬ 
ably indicate that such goods contain fiber other than silk. If the desig¬ 
nation of any goods coming within the category of mixed goods contains 
any reference to silk there shall be added to such designation words 
which shall reasonably indicate that such goods contain fiber other 
than silk. 

The Commission also voted against misuse of descriptive terms 
as follows: 

“ Servisilk ” as a descriptive term for an umbrella and its covering is no 
longer to be used that way, unless such covering be made entirely of silk, 
according to an order of the Federal Trade Commission to manufacturers. 
They will not use in their advertising the word “taffeta” or “Swiss 
taffeta” to describe the material of the covering of umbrellas made and 
sold by them, unless the coverings be entirely of silk. The commission 
holds that the word “silk” means to the public at large, as well as to the 
trade, a fabric made entirely of the product of the cocoon of the silkworm. 
The coined word “Servisilk” does not affect the meaning of the word silk 
as given above, the Commission ruled. The word “taffeta” when used 
to describe the content of a fabric denotes to the public as well as to the 
trade that the material thus described is entirely silk. 

Similar control over labeling fabrics has taken place in France, 
where the use of the word “silk” is limited to articles composed 
wholly or in the major part of natural silk, thus taking another 
step forward with the depositing of a bill on behalf of the French 
government, under the terms of which use of the word “silk” 
will be controlled. 

For a long time there was agitation for this step, but for the 
first time official action has been taken by the government to lend 
its weight to the passage of a bill drawn up along these lines. 
Under the terms of the proposed bill, it is forbidden to import, 
to hold with a view to selling, or to offer for sale, or to sell under 
the name of silk, or under a denomination containing the word 
silk all yarns, fabrics, or other articles which are not exclusively 


ADVERTISING AND BUSINESS ETHICS 


625 


composed of products or by-products of the cocoons of silk¬ 
worms. 

In modification of this, however, it is prescribed that a denomina¬ 
tion comprising the word silk may be applied to yarns, fabrics, 
or other articles, providing indication of the mixture is clearly 
marked in the denomination. Articles not benefiting by this par¬ 
agraph are those in which the proportion of silk does not exceed 
10 per cent of the total weight, or of which the warp or the nap are 
not entirely of silk. Selvages and braids are not to be taken 
into consideration when figuring the percentage, it is ruled. 

The terms of this bill, it is pointed out, do not prevent the use 
of any description or branded name not containing the word 
silk, nor do they prevent exporters from using any terms legally 
permitted in the countries to which merchandise is shipped. 

The code mentioned above has suggested that the following 
rules with regard to advertising be adopted by the Federal Trade 
Commission: 

Rule 1 . The making or causing or permitting to be made or publishing 
any false, untrue, or deceptive statements, insinuations or illustrations, 
by way of advertisement or otherwise, concerning the grade, quality, 
substance, character, nature, origin, size, preparation, or service of any¬ 
thing offered for sale, having the tendency or capacity to mislead or 
deceive purchasers, is an unfair trade practice. 

Rule 2 covers what is known as “ attacking copy,” or copy 
unfair to competitors. This rule mig*ht be adopted as easily as 
Rule 1. 

Rule 2. The making or causing or permitting to be made or publishing 
any false, untrue, or deceptive statements, insinuations or hostile references 
to or attacks on competitors, competitors’ merchandise or prices of service, 
or competitors’ advertising, generally or specifically, having the tendency 
or capacity to mislead or deceive purchasers, or to undermine in any 
other way the integrity of advertising itself and its believability on the 
part of the consuming public, is an unfair trade practice. 

Rules 3 and 4 attempt to correct the serious evil of “baiting” 
and misleading claims of underselling, and should be approved 
if the integrity of advertising is to be upheld. 

Rule 3. The making or causing or permitting to be made or publishing 
any false, untrue, or deceptive statements or insinuations of specific or 


626 ECONOMICS OF CLOTHING AND TEXTILES 


general underselling of competitors with the intent or the effect of under¬ 
mining competition, having the tendency or capacity to mislead or deceive 
purchasers or prospective purchasers, or with the intent or the effect of in¬ 
juring a competitor, or where the effect may be to substantially lessen 
competition or tend to create a monopoly or to unreasonably restrain 
trade, is an unfair trade practice. 

Rule 4. The use in advertising of so-called “baits,” offering merchan¬ 
dise at less than fair profits and sometimes at cost or less with the intent 
to lure customers to the store, where little or no effort is made to sell the 
advertised article, and the advertisement is for the purpose of selling 
other merchandise at regular or higher than fair profit to make up for 
the loss on the baited merchandise, having the tendency and capacity 
to mislead or deceive purchasers or prospective purchasers, is an unfair 
trade practice. 

Rule 5 would probably meet with the greatest opposition, but 
it goes to the root of the whole matter, and is necessary for the 
protection of those who have the greatest interest in advertising — 
the consumer, the producer, and the merchant. 

Rule 5. Price-cutting that becomes predatory when advertised with 
the intent or the effect of reducing competition, or the creation of a 
monopoly, or having the tendency or capacity to mislead or deceive 
purchasers or prospective purchasers as to the value represented by 
prices on other articles regularly sold by the advertiser, is an unfair trade 
practice. 

Price-Cutting. Many merchants claim that the cause of uneth¬ 
ical advertising is price-cutting. Underselling claims are not new. 
As early as 1868, a large dry goods store advertised: “As to our 
prices, we guarantee them 10 per cent lower than the lowest 
elsewhere, or cash handed back if shown to be otherwise.” 

This was in the days of haggling, before fixed prices came 
generally into storekeeping. The storekeeper was seeking to 
show that fixed prices, which he was putting into effect, were 
lower than haggled-over prices. Later the store abandoned its 
10 per cent lower guarantee as business adjusted itself to the fixed- 
price basis, and competition made it impossible for any store to 
substantiate such a claim. 

The root of practically all misleading, deceptive, and unfair 
statements in retail advertising is to be found in what is termed 


ADVERTISING AND BUSINESS ETHICS 


627 


predatory price-cutting — that is, the denial to competitors of the 
right to sell merchandise at prices as low as those of the one adver¬ 
tising. 

In the final analysis, predatory price-cutting is just what the 
phrase implies, destructive price-cutting, destructive in its results 
both to advertising and to business generally. 

Price-cutting, when predatory, is used as a weapon of attack 
on all competitors. By underselling on articles easily identified 
because nationally trade-marked and advertised, it seeks to give 
the impression that all prices are lower. It aims to undermine 
competition — to build up by tearing others down. In this use 
it is vicious and certainly should be classed as an unfair trade 
practice. I 

Predatory price-cutting, by its very nature, must lose gross 
profit on the articles whose price is cut and sometimes results in 
actual loss below any profit when the article is sold at less than cost. 

Advertising and selling policies are emphasized in recommen¬ 
dations made by the Committee on Unfair Practices in Advertising 
and Selling of the Affiliated Better Business Bureaus, Inc.: 

Believing it to be of paramount importance to the economic and social 
welfare of the American people that practices in business should be more 
clearly established and firmly maintained on a plane of fairness to compet¬ 
itors and to business as a whole, this committee proposes that business 
men themselves shall abandon and condemn any practices in advertising 
and selling merchandise, services, securities, and property of all kinds, 
which may have: 

(а) The capacity or tendency to undermine public confidence in advertis¬ 
ing announcements or other selling representations generally. 

(б) The effect of injuring unfairly the sales or the goodwill of a competi¬ 
tive product or service. To this end the following practices are con¬ 
sidered to be unfair and against the public interest: 

(1) Misleading advertising: The use of, participation in, publishing, or 
broadcasting of any untrue, deceptive, or misleading statement, repre¬ 
sentation, or illustration in an effort to sell any merchandise, service, 
security, or any property or thing of any kind is an unfair and uneconomic 
practice. 

(2) Unfair competitive claims: The use of, participation in, publishing, 
or broadcasting of any statement, representation, or implication which 
might be reasonably construed to lead to a false, or incorrect, conclusion 


628 ECONOMICS OF CLOTHING AND TEXTILES 

in regard to the goods, prices, services, or advertising of any competitor 
or of another industry is an unfair and uneconomic practice. 

(3) Disparagement of competitors: The use of, participation in, pub¬ 
lishing, or broadcasting of any statement, representation, or insinuation 
which disparages or attacks the goods, prices, service, or advertising of 
any competitor or of any other industry is an unfair and uneconomic 
practice. 

(4) Underselling claims: The use of, participation in, publishing, or 
broadcasting of any statement or representation which lays claim to a 
policy or continuing practice of generally underselling competitors is an 
unfair and uneconomic practice. 

(5) Bait, offers: The use of, participation in, publishing, or broadcasting 
of “bait” offers of merchandise wherein the prospective customer is 
denied a fair opportunity to purchase is an unfair and uneconomic practice. 

(6) Deceptive statements accompanying cut prices: The use of, 
participation in, publishing, or broadcasting of statements referring to 
cut prices on trade-marked merchandise or other in such a manner as to 
lead the public to believe that all other merchandise sold by the advertiser 
is similarly low priced when such is not the fact, is an unfair and un¬ 
economic practice. 

The Committee invites the cooperation of the press and other 
channels of public information in making these recommendations 
widely known to business groups and to the people throughout the 
country in order that an enlightened public opinion may favor 
and demand the establishment and observance of these construc¬ 
tive proposals. 

Standards Set Up. Reputable retail merchants have long 
realized the value and importance of fair dealing with their cus¬ 
tomers. They know that without the confidence of the public 
their advertising will not be believed and will not be productive. 
And so they have set up for themselves practical measures to 
prevent errors in their advertising. They have developed “ stand¬ 
ards of practice” — to tell the truth about furniture, to tell the 
truth about furs, to tell the truth about the contents of fabrics — 
silk, wool, cotton, rayon, linen, camel's hair — and all other 
merchandise advertised and sold by them to the consuming public. 

Much progress has been made toward eliminating unfair practice 
in advertising, as is indicated by the report of the Better Business 
Bureau of New York City, recently published. Standards have 


advertising And business ethics 


629 

been adopted in whole or in substance by retail groups in many 
cities, and newspapers and advertisers are cooperating in good 
measure. All of this adds to public confidence and to advertising 
productivity. 

The next forward step which seems to be taking shape is the 
stating and phrasing of advertising that is honest, accurate, and 
fair, so that the consumer will not be disappointed in the product 
through having been led to expect more or better goods. 

Undermining Advertising Tactics. The following represent 
unfair and misleading advertisements: 

1. One advertiser slurs the other and belittles his merchan¬ 
dise or his statements about that merchandise. This kind of 
undermining tactics lessens faith in all advertising and has be¬ 
come one of the most troublesome bones of contention in maga¬ 
zine censorship of copy. 

2 . Another form of misleading advertising is the insincere 
testimonial, often purchased by the advertiser, a practice which 
now, happily, is on the wane. 

3. The misuse of scientific authority in supporting advertised 
products, or their use, is another evil which it is more difficult to 
watch, because of the lack of technical knowledge on the part of 
the publishers. But there has been a good deal of it, much to the 
chagrin and disgust of scientific men. This is a subtler form of 
misuse, which the public is not so quick to detect, but which 
eventually is bound to react against all advertising. 

In the retail field the misuse of advertising is probably greatest 
because competition is closer at hand, more immediate. Sales 
are expected the very day the advertising appears. Results must 
be quick. Bargains appeal to a shopping group that goes from 
store to store as the appeal draws them. 

There is much reason, therefore, for the fact that retail advertis¬ 
ing is more intensive, more competitive, more aggressive, more 
dominating, and that stores are no longer satisfied with 48- or 
64-point type. 

The Quality Control Plan. The consumer is demanding more 
and more reliable information on labels of textiles and wearing 
apparel. Manufacturers are beginning to realize this fact. Thus 
the Silk Association is recommending that a tag be placed on each 


630 ECONOMICS OF CLOTHING AND TEXTILES 


silk garment stating it is a “pure dye fabric” or a “weighted dye 
fabric.” 

The manufacturers call the method or use of the label stating 
the quality of the fabric the Quality Control Plan. It has been 
used very successfully in the rayon lingerie trade. To illustrate: 
Before the use of the control plan, the buyer of the lingerie in a 
certain department store in 1930 did a business of $750,000. In 
order to keep up with competition he sold some skimped mer¬ 
chandise of too light a cloth. The year 1931 he did less than 
$200,000 of business. This loss was due to the false impression 
that some of the consumers obtained about rayon lingerie from 
the purchase of the low-grade article. 

The Quality Control Plan is of great assistance to the con¬ 
sumer. It is often difficult to detect cloth made of inferior yarns. 
Under the control plan the rayon yarn is tested in the best rayon 
laboratories of the country, and a constant check is kept on the 
finished product. This label has increased the sale of the higher- 
priced goods over the medium or lower-priced items. In some 
cases, sales have increased 400 per cent in a department by use 
of the Quality Control Plan. 

Continuing the message of quality control to the consumer, 
still another merchandising idea has been developed for the coming 
year. This idea centers around the instruction of the consumer 
in regard to washing Tested Quality garments. 

A similar emphasis on quality is being made in the rug industry. 
Adoption of the quality standard label, created, owned, and con¬ 
trolled by the Institute of Carpet Manufacturers of America, 
Inc., to be used upon all fabrics, has been approved by the members 
of this manufacturers’ organization, representing not only all the 
leading firms in the industry, but also a very high percentage of 
the total production of American-made carpets and rugs. It will 
be introduced first in the field of rugs. 

The label will be illustrative of the weaving of the fabric, and 
will be so registered under the law as to protect its use through 
the Institute. It will include the following statement over the 
name of the manufacturer producing the fabric: 

We guarantee that this fabric conforms to the Institute Specification 
as issued by the Institute of Carpet Manufacturers of America, Inc. 


ADVERTISING AND BUSINESS ETHICS 


631 


The adoption of the label marks the initial step in the Institute’s 
program to assist the industry as a whole in its desire to uphold 
and maintain quality in the manufacture of woven floor coverings, 
at a time when all manufacturers are hard pressed to do something 
about the appearance of extremely low-priced and consequently 
low-quality goods in their respective markets. It is especially 
fortunate that the rug and carpet manufacturers are now carrying 
out their determination. 

Labeling fabrics will mean that the individual manufacturer is 
proud of the workmanship involved, and the consumer will thus 
have a permanent and satisfactory guarantee of quality. Since 
fabrics with the Institute label attached will have to be quality 
products, the consumer will feel free to purchase such floor cover¬ 
ings, and soft-surfaced sales should increase in grades bearing 
the Institute label. 

The adoption of an Institute label and an effort at standardiza¬ 
tion of quality are coincidental. The label action is the result 
of the standardization effort carried out over a period of several 
months. The work of the technical committee which has had 
this in charge was carried through, accompanied by technical 
tests and very careful studies, over a period of months. As a 
result, a specific standard has been set up, below which any fabric 
will not be allowed to carry the Institute label. 

It might be well to point out that, in taking the action in respect to 
this whole label and standardization procedure, manufacturers not 
only wish to protect the manufacture, but also insure the general use 
of and universal confidence in the quality of carpet and rug fabrics 
made in the United States. It is an important and far-reaching 
move on the part of the industry, not only for its own benefit, but 
also for the benefit of those who buy and distribute its products. 
Moreover, it is a practical demonstration of an effort within an 
industry to support constructive and organized planning. 

Advertising Ethics. Codes of ethics have been adopted by 
many groups, trade organizations, etc. to govern competition, 
advertising, and other trade practices. Such a code of ethics was 
recently drawn up and adopted by representatives of some of the 
leading stores and advertising agencies of the country. The code 
has the laudable purpose of eliminating cut-throat competition, 


632 ECONOMICS OF CLOTHING AND TEXTILES 

dishonest claims in advertising, and other practices that in the 
long run react against business generally. 

Its sponsors believe that it is particularly needed during this 
period of uncertainty, when the temptation to get business by 
doubtful tactics is stronger than in seasons of normal prosperity. 
Its success will depend largely on the support given it by the 
majority of business houses, and by the discrimination of the 
public in buying from those concerns which have always main¬ 
tained high standards toward customers and competitors alike. 

Honesty and fair play are more necessary now than ever. A 
formal code of ethics is no guarantee of these qualities, but at 
least it is a sign that the business community is doing what it 
can to promote them. 

The happiness, prosperity, and development of any community, 
state, or nation depend upon the character and high standard of 
ethics of its members. Therefore, it is in the interest of efficiency 
that every community, state, and nation maintain a high standard 
of ethics for its members. Society is never perfect; we may 
approach from decade to decade an approximation to the ideal 
condition of efficient society, but we have never reached the 
point where every one is one hundred per cent efficient in his 
duties and obligations to society. 

The following is an outline of an advertising program to improve 
quality wearing apparel: 

A broad, educational campaign to promote the sale of styled mer¬ 
chandise of better quality and values, and to improve trade practice 
has been launched by the National Quality Maintenance League. 

The program proposes the use of motion pictures, radio, fashion 
exhibits, and the cooperation of important fashion and trade 
publications that are allied in the movement. The League includes 
in its membership manufacturers of woolens, silks, velvets, mil¬ 
linery, handbags, hosiery, and underwear, as well as editors and 
educators. The full cooperation and participation of leading 
retail stores throughout the country will be sought in the under¬ 
taking. The objects of the League, as set forth in the by-laws 
adopted, are as follows: 

To encourage the establishment and maintenance of high standards 
of quality in style merchandise, 


ADVERTISING AND BUSINESS ETHICS 


633 


To seek by cooperation among its members continuous improvement in 
design and quality in style merchandise. 

To inform the public of the essential desirability and the intrinsic 
value of better quality in style and merchandise. 

To use all means that may be offered for the prevention of falsity 
in advertising and selling, and for the discouragement of unfair trade 
practices which tend to tear down or destroy high standards of quality, 
or which tend to deceive the public as to values or desirability or quality 
in style merchandise. 

To prevent unauthorized or unfair copying of original ideas or designs 
in individual manufacturer’s products. 

To use all means that may be offered for the promotion of ethical 
standards in American business and generally to do such acts and things 
as may serve to accomplish any of the aforementioned objects. 

The principal purpose of this organization should be to educate 
the buying public of the country regarding the basic values of 
good quality and good style in merchandise. This education 
should be directed toward persuading the public to purchase 
merchandise on the basis of quality and service rather than of price. 

Advertising Campaigns. The following description shows how 
a campaign may be conducted for the increase in sales of boys’ 
and juvenile clothing, through a process of improving the quality, 
and making the public aware of this need for improvement. 

A preliminary survey proved the urgent need for immediate and 
active steps to revitalize and develop the boys’ apparel industry. 
It also showed the steady decline in production and sales by the 
manufacturers; a general attitude of carelessness and neglect on 
the part of the average retailer toward his boys’ wear department; 
the scarcity of novelty ideas, proper styling, and good fabric for 
boys’ clothing in the textile field; and the widespread and growing 
lack of uniformity and style in the wearing of boys’ apparel, all 
of which contributed in a large measure to the alarming depression 
in the* industry in 1931-1932. Recent statistics published by the 
Department of Commerce show that in December of 1929 the 
production of boys’ suits was less by 13,602 than for the same 
period in 1928. The production of boys’ overcoats, reefers, and 
light coats showed a decrease of 18,288 for December, 1929, as 
compared with December, 1928. These figures were based on the 
output of 850 identical establishments. It clearly showed a very 


634 ECONOMICS OF CLOTHING AND TEXTILES 


definite and real need affecting every branch of the boys’ clothing 
industry. 

The promotion campaign, therefore, has been planned to re¬ 
move these weaknesses in the industry by direct promotional 
activities. It has been planned to awaken the American boy to 
a clearer sense of the importance of his clothes, and the importance 
of well-styled, good-quality clothes, and at the same time to 
arouse his mother to a consciousness of the necessity of purchasing 
good quality, well-styled clothes for him; and in turn to help the 
millmen, manufacturers, and retailers to meet this potential 
demand with the proper merchandise. 

The textile millmen should make an analysis of their own 
situation and strive to maintain a high standard of merchandise 
and to style fabrics in weaves, patterns, and weights suitable for 
boys’ wear. The retailers should agree to give their boys’ wear 
departments greater prominence in their store arrangement and 
window display and to promote these departments through im¬ 
proved merchandising and advertising methods and also to improve 
their sales personnel in these departments. 

Trade Associations. All branches of wearing apparel have 
organizations of manufacturers or selling agents (distributors) for 
the purpose of promoting the advancement and prosperity of 
the trade interests by means of interchange of ideas, by gathering 
information, by harmonious action, by the development of indus¬ 
trial art, and by all other proper and appropriate means; and to 
eliminate unjust and unlawful exactions, misbranding, and 
unfair practices; to establish and maintain fair and uniform cus¬ 
toms and usages; to collect, compile, and disseminate facts and 
information; to cooperate with the government in carrying out 
its functions or in enforcing laws relative to the trade; to promote 
friendly intercourse among those engaged in the particular trades 
and industries and related activities. 

Any person, firm, or corporation engaged in the trade or industry, 
or a related trade or activity, is usually eligible for membership. 

These associations have permanent headquarters in charge of 
a paid secretary. They have done much to raise the standard of 
ethics, have eliminated many trade abuses, carried on campaigns 
to educate the public concerning the artistic and material values 


ADVERTISING AND BUSINESS ETHICS 


635 


of wearing apparel, and in addition have done much to increase 
the quality of raw materials, manufacturing processes, and 
designs. 

One of the best organized and most efficient trade associations 
in the textile industry in America, if not in the world, is the Silk 
Association of America. It has done much to develop the silk 
industry in this country and abroad. It has engaged in scientific 
research and has been the means, through its executive secretary, 
in developing all forms of testing. 

The following description will show how it has been active in 
developing a strong trade practice in the buying and selling of raw 
silk. Due to style developments and changes in manufacturers' 
dyeing policies the need has long been felt in the trade for rules 
to govern transactions between buyers and sellers of raw goods. 
In 1927 a committee was appointed to draw up Raw Goods Rules 
and the results of their compilation were presented to and approved 
by the board of managers at their meeting in September, 1928. 

The provisions of contract governing the purchase and sale of 
finished goods approved by the Silk Association of America, Inc., on 
January 4, 1928, are as follows : 

1. Credit. The seller or his factor may at any time limit or cancel the 
credit of the buyer as to time and amount, and as a consequence may also 
defer or reduce in quantity any delivery under the contract, and the 
merchandise herein described or such part as the seller may offer from 
time to time to deliver shall at seller’s option be payable in cash upon 
offer of delivery, which the buyer agrees to pay. If the buyer defaults 
in any such cash payment for ten days after any such offer to deliver 
has been made, the seller may at his option hold the goods offered for 
delivery for buyer’s account who shall be liable for the purchase price 
therefor or sell the same for the account of the buyer, but at his risk and 
expense, giving credit for the amount realized therefrom upon the purchase 
price thereof, without being liable to the buyer for any profit upon such 
resale. If deliveries are to be made in installments, a default in such 
cash payment by buyer upon offer of delivery of any installment as 
herein above provided may, at the option of seller, be deemed a default 
of the contract, for which default buyer shall be liable. Upon any of 
the aforesaid defaults by buyer, seller may at his option cancel the con¬ 
tract in writing. In no event shall the buyer be released from his liability 
hereunder unless the contract be canceled by the seller in writing. 


636 ECONOMICS OF CLOTHING AND TEXTILES 


2. Strikes and Casualties. Seller shall not be liable because of late 
or non-delivery due to accidents, strikes, fires, or other causes beyond 
his control. If by reason of any of the above causes, the production of 
the seller shall be partially or wholly curtailed, then the deliveries may be 
either proportionately or wholly suspended as the case may be, and resumed 
upon the removal of the difficulty and continued until the entire quantity 
purchased hereunder has been delivered provided that if such delay in 
delivery of any portion, by notifying the seller in writing to that effect. 
If the total period of delay in delivery of any portion due to any of the 
above causes exceeds 90 days, seller shall have the right to cancel any 
or all undelivered portions under the contract. 

3. Deliveries. The acceptance of shipment by a railroad or other 
common carrier shall constitute a delivery. Shipments made within 
seven days after specified date of delivery shall constitute a good delivery 
or tender made within seven days after specified date of delivery shall 
constitute a good tender. Where agreed delivery dates cover several 
months, without stating specific quantity for each month, the delivery 
shall be deemed good only if made in substantially equal parts for each 
month specified. Where deliveries are to be made in installments, whether 
of specified quantity or not, each installment and each part delivery shall 
be paid for in accordance with the terms of the contract regardless of 
claims by either party relating to any other delivered or undelivered 
merchandise. Where the buyer has declared or manifested an intention 
that he will not accept delivery of merchandise in accordance with the 
provisions of the contract, no tender of the merchandise shall be necessary, 
but seller may, at his option, give notice in writing to the buyer, that 
seller is ready and willing to deliver in accordance with the provisions 
of the contract, and such notice shall constitute a valid tender of delivery. 

4. Claims and Allowances. Goods shall not be returned nor allowance 
made nor claims made by the buyer for defects ascertainable upon inspec¬ 
tion after ten days from delivery of the goods to the buyer either at the 
contract place or to any other place or person named by the buyer, or 
after ten days after title has passed by appropriation or otherwise, nor 
after goods have been cut or otherwise changed from the original condition. 
Goods shall not be subject to inspection by the buyer before taking 
possession of same or delivery, and giving written receipt therefor. 

When the contract provides for the delivery of pieces in lengths or cuts, 
a variation of not more than 8 per cent either way from the specified 
yardage in any particular piece, shall be deemed a compliance with the 
contract, but the variation from the total yardage under the contract 
shall not exceed 3 per cent either way. 


ADVERTISING AND BUSINESS ETHICS 


637 


5. Rejections and Replacements. Goods rejected by the buyer may be 
replaced by the seller within fifteen days after rejection has been agreed 
to by seller. If any dispute arises, it shall be settled by arbitration in 
accordance with the rule on Arbitration. 

6. Warranties or Modifications. No warranties or modifications of 
the agreement shall be binding unless signed by the party against whom 
any claim arising under the agreement is made. 

7. Receipts. Receipts for delivery of merchandise shall be evidence 
of delivery and acceptance only and shall not constitute a waiver of 
modification of any of the terms of the contract. 

8. Acceptance of Order. This order shall become a contract only 
when signed and delivered by the buyer to the seller and accepted in writ¬ 
ing by the seller, or when buyer has accepted delivery of the whole or 
any part of the goods herein described. 

9. Deferred Assortments — Default — Appropriation. Where a con¬ 
tract covers the sale of goods, in which colorings, designs, patterns, or 
assortments are not determined at the time of sale, seller will submit 
colorings and designs for acceptance, from which buyer agrees to make 
selection or furnish assortment within a reasonable or specified time, 
In the event of the buyer’s failure so to do, the seller at his option may 
make the selection or assortment according to his judgment and appropri¬ 
ate the same in the finished state or at his option in the raw, at the full 
contract price, to the contract for the account of the buyer. Such goods 
appropriated in the raw shall, at the request of buyer, be converted by 
seller as provided in this contract without further cost to buyer. Failure 
of buyer to assort within a specified or reasonable time will not release 
the buyer from his contract. 

If the buyer fails to take delivery or defaults in any provision of the 
contract between him and the seller, all goods contracted for, finished 
or in the raw, whether assorted and selected by the buyer or by the seller, 
and appropriated to the contract, shall, at the seller’s option, be billed 
at the contract date of delivery at the contract price and be payable 
according to the terms and conditions thereof or be payable in cash, 
for which the buyer agrees to be liable and the goods held for the buyer’s 
account and risk, or the seller may cancel the contract in writing. The 
agreement shall be deemed the buyer’s assent and the buyer does hereby 
assent to the appropriation by the seller, at the contract date of delivery, 
at the seller’s option, of all goods deliverable under the agreement. Title 
to the goods so appropriated shall then pass to the buyer. 

10. Arbitration. All controversies arising out of or relating to the 
contract shall be settled by three arbitrators in accordance with the rules 


638 ECONOMICS OF CLOTHING AND TEXTILES 


of the Silk Association of America, Inc., each of the parties to select a 
third. At least one of the arbitrators shall be an official arbitrator of the 
Silk Association of America, Inc. The award shall be final and binding 
upon all parties. 


QUESTIONS 

1. ( a ) What is advertising? (6) State its importance and economic 
justification. 

2. WTiat are the characteristics of an advertisement of clothing? 

3. State the advantages of advertising. 

4. State the types of advertising and the advantages and disad¬ 
vantages of each type. 

5. Give examples of branded and non-branded textiles. 

6. Explain some of the abuses of trade names. 

7 . (a) What constitutes successful advertising? (6) How may one 
determine the success of advertising ? 

8. Give a list of means or devices for arousing attention in advertising. 

9. State the essentials in developing advertising space and illustrate. 

10. What are the devices for making successful appeal in advertising? 

11. State the advantages and disadvantages of different kinds of 
advertising mediums. 

12. What are the special methods of advertising through (a) mail, 
(6) house organ, (c) calendars, (d) novelties, (e) handbills, (/) blotters, 
(g) free samples, ( [h ) outdoor advertising, ( i ) sign boards, ( j ) street car, 
(k) electric illuminated signs. 

13. (a) What is meant by cooperative advertising? (6) Give some 
illustrations, and state the advantages and disadvantages. 

14. Give illustrations showing the effect of campaigns for advertising 
wearing apparel and style promotion. 

15. (a) What is the Federal Trade Commission? (b) State its duties. 

16. Why are business ethics important in advertising? 

17. State the necessity of correct labeling. 

18. Name some of the abuses of advertising and also the code of 
ethics of good advertising. 

19. State the value of trade organizations and also their influence 
in upholding high standards of ethics. 


CHAPTER XVI 


DISTRIBUTION OF THE SOCIAL INCOME 

Definition. As a result of the combined efforts of the various 
factors of production — land, capital, labor, management, and 
the state — society receives every year a vast supply of goods and 
services, which contribute to the welfare of its members. This 
total supply of goods and services is called the social income. The 
way in which this income should be distributed to the various 
factors that have aided in its production is one of the greatest 
problems of modern times. 

In order to make the discussion clearer, this social income may 
be classified roughly by the various types of products. For 
example, the total of clothing and textile products constitutes the 
wearing apparel income of society. 

Any analysis of the clothing industry will show that five factors 
contribute to the production of a commodity such as a woolen 
suiting. (1) Land supports the sheep that supply the wool; it 
furnishes a building site for the mill and for the establishment in 
which the product is sold; it may furnish water power for the 
mill. (2) Capital funds are necessary for purchasing raw mate¬ 
rials, paying labor, etc.; capital goods in the form of machinery 
are required for carding, spinning, weaving, and finishing the 
material. (3) Labor is essential to carry on the processes of 
cleaning, spinning, weaving, and finishing the cloth and making 
it into a suit. (4) The production is supervised and planned by 
technically trained business men who assume the responsibilities 
and risks of the business. (5) The state contributes by providing 
protection of property, health, etc.; it provides education for 
workers, etc. 

Similarly, in the knitting industry we can recognize the same 
five factors of production, working together cooperatively to 
produce a commodity such as hose. (1) Land — to produce the 

639 


640 ECONOMICS OF CLOTHING AND TEXTILES 


cotton, as a site for the cotton mill and the knitting mill. (2) Cap¬ 
ital — supplied by the capitalist. (3) Labor — the workmen who 
perform the actual processes of manufacture under the direction 
of the business manager. (4) The business man or technically, 
the entrepreneur — who supervises and organizes the production 
in the mill. (5) The government or community which promotes, 
regulates, protects, and otherwise facilitates the production. 

We saw in an earlier chapter that each factor in production 
receives in return for its contribution a certain portion of the 
social income. That portion returned to land is called rent, 
that portion belonging to capital is called interest ; labor receives 
its reward in the form of wages / the entrepreneur receives his 
reward in the form of profits. The contribution of the government 
entitles it to a return in the form of taxes. 

Importance. These five factors will be found in every type of 
production of commodities, although they may not always be 
represented by distinct elements. Thus in a small plant the 
business man may supply his own capital; indeed, he may in 
some cases act as a laborer in his own establishment. In such 
cases the business man is performing several functions in pro¬ 
duction and represents two or more factors as outlined above. 
Since each factor is entitled to a certain return from the social 
income, we may find the business man in such instances receiving 
not only the profit from the business, which is that part of the 
social income that is reserved for the entrepreneur, but he is like¬ 
wise entitled to interest on the capital invested. If he owns the 
land on which the factory is located, he is also entitled to a certain 
allowance for rent, which is the legitimate return to the land for 
its contribution in production. 

We must remember that the social income is not in reality 
money, but is the total supply of commodities and services made 
available to society. Thus the wearing apparel income consists 
of the large quantities of cotton cloth, wool and worsted cloth, 
silk and rayon products, costumes, etc. These commodities are 
marketed, and in exchange the consumers give money, the medium 
of exchange. Thus the various factors receive their return in the 
form of money. With this money they can proceed individually 
to purchase such commodities as they need, pay their rent, personal 


DISTRIBUTION OF THE SOCIAL INCOME 


641 


taxes, etc. Actually the extent to which each factor shares in 
the social income must be measured in terms of the purchasing 
power of the money received in return for the particular contribu¬ 
tion to production. Money is merely a convenient means for 
distributing the social income. 

Just as the entrepreneur is responsible for the organization 
and responsibilities of production, so he is responsible for the 
distribution of the products of production. Thus when the 
commodities and services of the wearing apparel income are sold 
in the market, and the market value in terms of money is to be 
distributed among the various factors that helped to produce 
them, it is the business man or entrepreneur who regulates the 
shares to be returned to the various factors. Justice and fairness 
would demand that each factor receive its exact share of the total 
amount — i.e ., that each factor should be rewarded according 
to the contribution it has made to the total product. 

Obviously, there is no exact or practical method for determining 
mathematically the exact value of the various functions in pro¬ 
duction. Such contributions can be measured only approximately. 
As a result, it is natural for each factor to try to secure as much 
as possible for itself. If one factor receives more than its share, 
then one or more other factors will receive less than their share. 
Hence the effort of each factor, particularly capital, business men, 
and labor, is to secure as much as possible, even at the expense 
of the others. This -struggle accounts for the intense bitterness 
and the frequent strikes and misunderstandings that take place 
in the clothing centers, textile mills, etc. 

Of course, all factors should remember that the more wealth in 
wearing apparel, etc., that is created, the more there will be to dis¬ 
tribute, and any attempt to reduce the clothing or social income 
will reduce proportionally the amount to be distributed. 

National Wealth. According to a current study of national 
wealth emanating from the National Industrial Conference 
Board, the wealth of the United States in 1928 was $360,100,- 
000,000. The census figure for 1912 was $186,300,000,000, and 
for 1922, $320,800,000,000, an annual gain of $13,450,000,000 for the 
intervening ten years. The average annual increase for the six years 
from 1922 to 1928 is thus mathematically about $6,550,000,000. 


642 ECONOMICS OF CLOTHING AND TEXTILES 


The Board’s definition of national wealth includes all tangible 
physical assets, embracing notably land, and excludes credits and 
currency in the form of paper. On this broad basis, realty in the 
form of land and improvements forms more than 50 per cent of 
the total. The figure is $198,100,000,000, of which $23,000,000,000 
is tax-exempt government, church, charitable, and educational 
property. 

Railroad, public utility, shipping, and canal properties represent 
$39,500,000,000, of which a tenth is in land. Farm and factory 
equipment, the first comprehending live stock, is placed at $27- 
200,000,000. Merchandise, crops, and industrial products are 
shown at $40,600,000,000. Furniture, clothing, jewelry, and 
other things classed ambiguously as “personal property” are 
valued at $44,700,000,000, or 65 per cent more than the entire 
equipment, including live stock, of farms and factories. Per 
capita wealth was $3000 in the same year. 

National Income. The annual income per inhabitant is greater 
in the United States than in any other country in the world. 
The comparative incomes of the leading nations of the world in 
1930 were as follows : 

Annual Income of Dollars for Each Inhabitant 


Italy.$115 

Great Britain. 409 

Belgium. 171 

Russia.*. 100 

Sweden. 265 

Germany. 190 

France. 201 

Switzerland. 389 

United States. 700 


In 1929 the per capita income in this country was somewhat 
more, or $780. Because of depression conditions commodity pro¬ 
duction was substantially less in 1930 and the per capita income 
was reduced to $700. 

Distribution of the National Income. While figures of national 
wealth and national per capita income are interesting for compar¬ 
ison with other countries, they furnish very little information 
about the actual distribution of the social income in the United 











DISTRIBUTION OF THE SOCIAL INCOME 


643 


States. This income is not divided on any proportional basis, 
but is apportioned unequally among the various factors of pro¬ 
duction according to their contribution to its production. Since 
the entrepreneurs of American industry are actually the central 
distributing agencies for the social income, we find the amounts 
accruing to the different factors varying widely from time to 
time, and in different industries. Since each factor is striving 
to receive as large an amount as possible, the final distribution may 
bear only an approximate relationship to the actual contribution 
made by each. For this reason we find that the distribution of 
the social income is one of the most important problems faced by 
modern society. 

Many statesmen, economists, and successful business men feel 
that our depressions, particularly the one from 1930-1932, are due 
to the fact that wages as a whole do not rise in proportion to the 
reward to capital during periods of prosperity. This is a doctrine 
that adherents of the socialist party or Marxist school of economic 
thought will no doubt applaud enthusiastically, but if it is a 
correct statement of fact, non-socialists should not for that reason 
reject it. If the working classes of the United States have, as 
asserted, been denied an adequate share of the national income, 
and if this discrimination is responsible for the piling up of huge 
profits, which have encouraged investment in unsound, unprofit¬ 
able, and speculative enterprises, then it is important to recognize it. 

There is no doubt that a large part of our troubles is due to 
“selfish and opportunist groups,” in the distribution of that 
income. National income, in the future, must be distributed 
differently. In good times during the World War there was a 
big income, about $90,000,000,000, of which workers were getting 
$60,000,000,000, or about 66f per cent. 

Naturally, in times of depression wage reductions must take 
place. Many reductions took place in 1930-1932. The only 
question is as to the proper measure of such decreases. These 
should not exceed the decline in the cost of living. It may be that 
reductions of a lesser amount will be effective. Furthermore, it 
may be appropriate that wage reductions shall be accompanied 
by pledges to restore the old scales pro rata with advances in the 
cost of living. 


644 ECONOMICS OF CLOTHING AND TEXTILES 

In the end, labor profits only as capital profits, and labor can 
afford, even less than capital, to risk the blighting effect on business 
recovery that will result from attempts to maintain wage rates that 
begin to appear hopelessly out of line with the new level of prices. 

Ricardo’s Iron Law of Wages. Ricardo’s iron law of wages ex¬ 
presses the theory that average wages tend always to reach the lowest 
amount necessary for sustenance in order to maintain existence and 
propagation. Because of the excess of workers, three or four apply¬ 
ing for the same position, thus producing an excessive competition, 
it would follow by Ricardo’s law that wages would tend to become 
lower and lower until they reach the lowest point consistent with ex¬ 
istence. This situation would apply particularly to the group of 
unskilled laborers who represent the largest number of workers. 

Actually, Ricardo’s law is based upon false suppositions — 
unlimited competition in industry and supreme rule of supply and 
demand. Any theory which regards man only as a hired animal 
is essentially false. Society has provided laws that protect the 
weak against such unjust oppression by the strong. When wages 
become too low, society steps in and sets a minimum wage for 
unskilled labor in the various industries. 

The question of how to determine the wage or salary of a worker 
is a very serious problem and a complex one. The total wage 
may be determined roughly as the difference between the value of 
what a workman produces and the expenses of production (includ¬ 
ing interest on investment, rent, etc., and a compensation to the 
employer for his labor in production and exchange). The average 
amount of this difference per year or per season may be a safe 
method of determining that wage. Of course, the individual 
wage must be based upon approximate equality between what is 
given and what is received by the workman. This should in all 
cases be sufficient to meet a decent standard of living for the 
unskilled worker. The wages or salaries of other types of labor 
are determined more or less by the law of supply and demand. 

We have seen that people differ greatly in their abilities and 
hence in their contributions to production. Some are able only 
to perform certain operations under guidance; others can super¬ 
vise the operators to see that the work is done efficiently and with¬ 
out loss of time. While the detail work of production must be 


DISTRIBUTION OF THE SOCIAL INCOME 


645 


done by unskilled and skilled workmen, at the same time it is 
necessary to have leaders who will plan and organize the work. 
Otherwise, the total production and the workers’ share in that 
production will not equal the highest possible amount. Some 
men and women with exceptional ability may be called the generals 
of industry; others with somewhat less ability and training may 
be considered captains. Under these we find lesser commissioned 
officers, and the large remaining body of privates. 

Salaries and wages are thus graduated upward from the minimum 
wage for the least skilled workers to the higher-skilled supervisors, 
designers, stylists, overseers, superintendents, etc., in the clothing 
and textile industries. 

Types of Workers. The textile and clothing industries are able 
to utilize workers of various types of mentality, ranging from the 
genius with his power of leadership to the imitative unskilled 
worker, with a negative personality, whose only asset is physical 
power — the ability to push and to drag under supervision. 
Between these two extremes are all types of workers — salesmen, 
artists, chemists, foremen, etc.' Each type is useful in certain 
work, and the industries thrive best when there is a good supply 
of all types of workers properly trained to perform the various du¬ 
ties from business management to machine tending, designing, etc. 

The amount of detail work in textile and clothing production 
is very great. Much of the work in the clothing trades after 
the fabrics have been cut consists in assembling and stitching 
the parts together. The character of the work is very simple 
and naturally can be performed by recent immigrants, children, 
and housewives who wish to make additional income for the 
family. Contractors or jobbers take the cut fabrics and have 
them assembled and stitched on a contract basis. 

It may be worth while to enumerate the different types of 
workers employed in industry and to state the characteristics of 
each class. 

We have seen that every organization is divided into two depart¬ 
ments : production (manufacturing) and the exchange or market¬ 
ing (selling) phases. Production is carried on by an organization 
varying in size from small to large. This organization comprises 
a manager, agent or superintendent, overseers or foremen, section 


646 ECONOMICS OF CLOTHING AND TEXTILES 


or second hands, and workers. The large establishments have, 
in addition, designers or draftsmen, testers or chemists, shop 
supervisors, and sometimes research engineers. 

The manager or superintendent may or may not come from 
the ranks. In the past it has been possible for men lacking tech¬ 
nical training, but possessing good common sense and business 
capacity, to rise to this position. This is not true today in many 
engineering establishments and large factories. Often the super¬ 
intendent is a technically trained man who entered the industry 
direct from school as an assistant to the manager or superintendent. 
To qualify for this position a man must have a great deal of fore¬ 
sight and will power; he must have initiative, an analytical mind, 
and executive ability — that is, he must be able to see clearly a 
problem and its solution, and must have the ability to put the 
solution into effect. 

The technical progress of industries in the past has been due 
to the efforts of scattered inventors and workmen, all laboring 
under great disadvantages. Manufacturers and tradesmen are 
beginning to see that there are numerous possibilities of applying 
different scientific discoveries that have taken place as outlined 
in Chapter X. Competition compels us to realize that all indus¬ 
tries and trades have developed to a point where the working out 
of theory and practice has become a science, and that the appli¬ 
cation supersedes the old “ rule-of-thumb ” method and demands the 
continuous employment of scientifically trained leaders in a bureau 
of research. The results of this bureau will tend to lower the cost 
of production by eliminating factory weaknesses, improving tools, 
and applying the principles of science to raw materials, waste 
products, methods, etc. It is for this reason that the Bureau of 
Standards and large corporations, such as the Du Pont Chemical 
Company, have research staffs with a group of specialists working 
on new industrial problems. The group may include chemists, 
biologists, designers, metallurgists, mechanicians, etc., who have 
been trained in the scientific departments of the colleges. 

A foreman usually comes from the ranks of workers. He is the 
job master, and as such must be able to form good judgments of 
human values, and to handle men. In addition, his outlook on 
life will be very different from that of the worker. 


DISTRIBUTION OF THE SOCIAL INCOME 


647 


The skilled worker should have — in addition to good health — 
a clear mind capable of keen perception, and an inventive faculty 
— a quality which is often called ingenuity. His keen sense- 
perception should be such as enable him to do very accurate work, 
dealing with measurements of a thousandth part of an inch. The 
skilled worker differs from the unskilled worker in degree of 
mental versatility. He has acquired by experience a fund of 
information and skill so that he is able to form new judgments. 
The tasks of the skilled worker are such that only recent trade 
experiences are valuable for ready recall. This is the principal 
reason why a skilled workman can not leave his trade for any 
length of time without suffering a loss of skill. 

Semi-skilled workers or machine tenders, spinners, weavers, etc., 
should have a good physical development and quick time-percep¬ 
tion, which is really the quality of dexterity. Often such workers 
are physically sluggish, in addition to the general characteristic 
of slow mentality, which may be due to the lack of nutritious 
food or to dissipation, or both. Any reflective action on the part 
of the semi-skilled worker retards his rate of production. These 
workers are generally recruited from the ranks of those who leave 
school early, follow a line of employment with no prospects until 
they reach manhood, and then see a chance of getting an adult 
wage without going through the training necessary for the skilled 
positions. This worker is seldom called upon to meet a new 
situation, and his work never involves problems which can not 
be solved from the limited range of his past experiences. Auto¬ 
matic and semi-automatic machinery develops a fatigue, which 
is a serious problem. Women are able to work in this way better 
than men, and do not show fatigue to as great an extent. 

The unskilled workers usually represent the least intelligent 
part of the community. Of course there are exceptions, as in the 
case of bright young people who have become “ blind-alley ” 
workers, or others who lack the sense of responsibility. In spite 
of the great increase in inventions, there are a great many processes 
performed by unskilled labor. 

The occupations found in the textile and clothing trades and 
industries may be roughly divided into the following groups: 

Occupations requiring skill and trade knowledge. 


648 ECONOMICS OF CLOTHING AND TEXTILES 


Occupations requiring skill and no trade knowledge. 

Occupations requiring trade knowledge and no skill. 

Occupations requiring neither skill nor trade knowledge, except 
in a very low degree. 

There is a certain amount of industrial training that must be 
imparted to the men engaged in the exchange or marketing phase 
of industry. The knowledge of the salesman of his produce 
should be thorough, and at the same time should be different from 
that of the mechanic. 

In addition to the above we find designers of fabrics, costume 
designers, and illustrators and colorists. 

The following types of workers are found in a textile mill: 

(a) Skein inspectors, including reinspectors, tensile testers, sorters, 
and graders. They inspect, sort, and grade skeins of yarn before they 
are wrapped and packed for shipment. 

( b ) Cone, quill, cop, and bobbin inspectors examine for broken threads 
and neat knotting and classify for packing. 

(c) Wrappers and packers wrap, bundle, and pack skeins, cones, 
quills, cops, and bobbins for shipping. 

(d) Truckers and handlers wait on or serve employees in other occupa¬ 
tions by taking to and from them bobbins, spools, skeins, cones, etc. In 
some plants they are classed as service men. 

(e) Laborers do the various kinds of unskilled work, such as moving 
materials and general cleaning. 

(/) Other employees. This group includes wage earners in approxi¬ 
mately 100 occupations in the industry other than those specified above. 
Each of the occupations in the group has too few workers to warrant 
tabulation as an occupation. 

The classification of workers in a shoe factory is even more 
complex: 

Cutting department: 

Cutters, vamp and whole shoe, hand. 

Cutters, vamp and whole shoe, machine. 

Cutters, trimmings, hand (including dinkers and blockers). 

Cutters, trimmings, machine. 

Skivers, upper. 

Cutters, linings, hand. 

Cutters, linings, machine. 




DISTRIBUTION OF THE SOCIAL INCOME 


649 


Sole-leather department: 

Cutters, outsole. 

Cutters, insole. 

Rounders, outsole or insole. 

Channelers, outsole or insole. 

Cutters, top and heel lifts, machine. 

Heel builders, hand. 

Heel builders, machine (including compressors). 

Fitting or stitching department: 

Stampers, linings or uppers (including markers). 

Cementers and doublers, hand and machine (including reinforcers, 
pasters, and fitters). 

Folders, hand and machine. 

Perforators. 

Tip stitchers. 

Closers or seamers. 

Seam rubbers, hand and machine. 

Lining makers (including lining closers and side and top facing stitchers). 
Closers-on. 

Top-stitchers (including under-trimmers and barber trimmers). 

Binders (including top banders). 

Buttonhole makers. 

Button fasteners. 

Eyeleters (including hookers). 

Vampers. 

Barrers (including tackers). 

Tongue stitchers. 

Fancy stitchers. 

Backstay stitchers (including back strappers). 

Table workers. 

Lacers (before lasting). 

Lasting department: 

Last pickers or sorters (including last casers). 

Assemblers, for pulling-over machine. 

Pullers-over, hand. 

Pullers-over, machine. 

Side lasters, hand. 

Side lasters, machine. 

Bed-machine operators. 

Hand-method lasting machine operators. 

Turn lasters, hand (including first and second lasters). 


650 ECONOMICS OF CLOTHING AND TEXTILES 


Turn lasters, machine. 

Turn sewers. 

Tack pullers, hand and machine. 
Bottoming department: 

Goodyear welters (including in-seamers). 
Welt beaters and slashers. 


Shoe Factory in Santiago, Chile 
In which American machinery is used 

Bottom fillers, hand and machine. 

Sole cementers, hand and machine (including bottom cementers). 

Sole layers, hand and machine. 

Rough rounders. 

Channel openers and channel closers (including channel layers, channel 
turners, channel cementers, and lip turners). 

Goodyear stitchers. 

McKay sewers. 

Stitch separators (including stitch wheelers). 

Levelers. 









DISTRIBUTION OF THE SOCIAL INCOME 


651 


Heelers, leather. 

Heelers, wood. 

Heel trimmers or shavers. 

Heel breasters. 

Edge trimmers. 

Sluggers. 

Finishing department: 

Buffers (including bottom scourers). 

Naumkeag operators. 

Edge setters. 

Heel scourers (including first and second scourers). 

Heel burnishers (including stoners, expediters, and heel slickers). 

Bottom finishers (including bottom slickers). 

Brushers. 

Shoe cleaners. 

Last pullers, hand and machine. 

Treers, hand and machine. 

Repairers (not cobblers) (including tip fixers and scourers). 

Dressers. 

Sock liners (including heel-lining, heel-pad, and heel-pin pasters). 

Lacers (before packing). 

Packers. 

Work that requires the least skill is usually found in connection 
with longer hours. Mill employees labor longer than machinists 
or electricians, hence mill or textile work is not as popular as 
electrical work. Certain kinds of labor are more irksome and 
tiresome than others, chiefly because of the longer hours. Human 
nature longs for rest and recreation. Experience has shown that 
labor tends to become disagreeable, painful, and monotonous 
with repetition. For this reason we find a tendency in larger 
plants to limit the hours of labor for such work to eight hours. 

Up to the age of twelve, children do not show marked differences 
in characteristics. After this age, children begin to differ, par¬ 
ticularly in their physical and mental capabilities. Some children 
grow faster than others. Some children lose interest in books and 
dislike the methods of formal teaching as carried out in school. 
It is from this class that industry and commerce have recruited 
their workers. While most of these children lack the power to 
commit to memory the information on the printed page, they 


652 ECONOMICS OF CLOTHING AND TEXTILES 


often possess large imitative powers, particularly along the line of 
manipulative skill. 

This skill differs with various people. Some have the power 
to work with materials to a thousandth part of an inch. Others 
have the power to work only to one-eighth of an inch. Some can 
develop their senses to a remarkable degree. Many young women 
and men have the power to coordinate their fingers, hands, and 
eyes and do rapidly very fine needlework and other detail work 
on wearing apparel. In addition, this class has a strong cooper¬ 
ative spirit, is not too ambitious, and has large physical powers that 
can be utilized in the complicated system of industry and com¬ 
merce of wearing apparel, and it does a great part of the world’s 
work. 

From this group are recruited the craftsmen who design wearing 
apparel, the workers who control the machines and the raw mate¬ 
rial, and the traders who buy and sell and create the demand for 
the finished product. 

Capital and Labor. The organization of modern industry has 
become so complex since the introduction of power machinery 
and large-scale production, that there has appeared a distinct 
conflict between two groups in industry — those who own, super¬ 
vise, and direct capital in production, and those who work for 
wages. The first group represents management and capital in 
the factors of production, and the second group represents labor. 
The problem of apportionment of the social income is largely a 
question of the share labor shall receive for its contribution to 
production. 

We have already, in Chapter I, considered the various factors 
of production and the form in which each receives its share of the 
social income. Thus we find the return for land being made in 
the form of rent; the return for capital in the form of interest. 
The amount of rent varies according to the fertility of the soil, the 
location, etc. The amount of interest on money invested varies 
somewhat according to the degree of risk, the amount of capital 
supply in relation to demand, etc. 

Owners of land and capital and the entrepreneurs of business 
all belong to the capitalist group, as it is generally spoken of, in 
contrast to the large body of workers, who represent the element 


I 


DISTRIBUTION OF THE SOCIAL INCOME 653 

of labor. The struggle of the workers to obtain a larger share 
in the social income is the real basis of the labor problem in Amer¬ 
ica as in other countries. For this reason it will be wise to discuss 
at some length the contribution of labor to production and the 
reward to labor in the form of wages. The fifth factor in produc¬ 
tion — the government — and its share in the social income will 
be considered later. 

Labor as a Factor in Production. Labor is a term used in 
general to refer to the physical efforts of man, but in an economic 
sense it includes all human efforts, both physical and mental, 
used in the creation of utilities in goods. The physical efforts 
depend upon health and strength, and the mental upon gen¬ 
eral education, technical education and skill, moral qualities, 
honesty, industry, and reliability. Labor, in the general sense, 
refers to the exertion of body or mind with a definite purpose, 
wholly or mainly with a view of maintaining or bettering the condi¬ 
tion of life. Work is what is accomplished or is done by labor. 
The purpose of work is to procure or improve on the necessities, 
comforts, or luxuries of life. 

Labor in the past has been contributed by slaves, serfs, servants, 
or wage earners. Slave and serf labor are degrading, and there¬ 
fore do not exist in this or any civilized country. Servants may 
be given lodging and board with a fee or stipend. Most of the 
workers today employed in industry receive a payment under 
contract for industrial work done for another. The laborer is a 
human being whose wages are necessary for the conservation of 
existence and efficiency, and whose work is primarily directed to 
this purpose. Labor, therefore, is different from a market com¬ 
modity even though it is in many respects treated as one in indus¬ 
try. The wages paid to labor are generally considered to be the 
price paid for it, and this price is to a large extent controlled by 
supply and demand and other factors that govern the price of 
commodities. But such a theory of labor is not adequate in our 
present social order. 

Dignity of Industry and the Worker. A glance through edu¬ 
cational history will show us that the reason hand labor has not 
received a dignified place in society and education is due to the 
tradition from the Greek philosophers, who looked with contempt 


654 ECONOMICS OF CLOTHING AND TEXTILES 


on manual work, which was performed by slaves — the workers 
and tradesmen of the age — and purposely omitted from the 
schools the training in utilitarian subjects. 

During the Middle Ages the same feeling existed; hand work 
and industrial education were apart from culture; the former 
were matters of apprenticeship and the latter a matter of books. 
This state of affairs continued in England up to the nineteenth 
century, when the primary school provided the education for 
the industrial workers. Pupils were educated in the higher 
schools to be employers. People were expected to remain in 
their station of life. Culture was the possession of the upper 
classes and had absolutely nothing to do with utility. During 
the last century the sentiment that the masses were expected to 
support the classes in their leisure has passed away, particularly in 
America. The spirit of democracy has dominated our social 
system, so that today every man is expected to be a worker of 
some kind. 

No industry today has suffered more from misunderstandings 
and disagreements between the workers and the manufacturers 
than the textile and clothing industries. The worker offers his 
services for sale to the manufacturer. The industry requires 
both the worker and the manufacturer. Therefore it is absolutely 
necessary for the workers and manufacturers to come to an agree¬ 
ment through the spirit of cooperation. 

The Rights of Labor and Capital. The rights and duties of 
manufacturers (capital) and labor may be considered from the 
two points of view : the natural rights and the legal or social rights. 
The natural right of man is the universal need of mankind, while 
the legal or social right is the need of man that society is pledged 
by custom to guarantee. These rights are constantly changing 
because of political conditions. The legal or social right has 
worked to the disadvantage of labor, so that it receives a minimum 
living wage but not much more. By raising the standards of 
living, the lower or laboring classes will secure (a) better religious 
and character training, (6) more recreation, (c) better education, 
(i d ) better housing and feeding, etc. 

While labor, from a strictly economic point of view, is a com¬ 
modity, nevertheless experience shows that it is a special com- 


DISTRIBUTION OF THE SOCIAL INCOME 


655 


modity that requires special protection and legislation. Other¬ 
wise many employers in their zeal for profits and lack of vision 
will attempt to exploit labor without realizing the harmful future 
effects on both industry and community. Many progressive 
manufacturers have sufficient vision to see that labor should be 
treated with consideration, and that wages, hours of service, etc., 
should be considered from the best interest of society, which is 
also the best interest of the manufacturer and laborer. 

Hence, society has been obliged to protect the rights of labor 
and enact such legislation as will be favorable to it. Among the 
most important laws passed by different States and countries are 
the following : (a) Regulations for safety of employees, (b) sanitary 
laws for factories so the workers may have fresh air, plenty of 
light, and proper sanitary conveniences, (c) laws limiting the 
hours of labor to eight, or less in times of decreased productivity, 
to insure sufficient work for all, ( d ) laws requiring at least one day’s 
rest in seven, so that each worker will have sufficient time to relax 
and enjoy the companionship of his family and friends, (e) work¬ 
ingmen’s compensation for accidents, so that a worker may receive 
a percentage of his pay while he is injured, (/) elimination of 
child labor so that every child may attain his physical growth 
and schooling during adolescence, (g) many States have passed 
a law protecting women and children from low wages, requiring 
manufacturers not to pay less than a definite amount, ( h ) un¬ 
employment insurance and old-age pensions have been adopted 
by clothing unions and certain governments. 

Conditions of Labor. Labor does its best work or has its 
highest efficiency when there is (a) division of the work, (6) effort 
directed correctly, (c) a spirit of cooperation among all groups, 
(d) a proper attitude of employees and the government toward labor. 

The government in the interest of society protects the manu¬ 
facturers and the workers. Both are necessary to society, but 
neither must attempt to do things that will interfere with the 
success of society as a whole. Industrial operations that are 
harmful to workers must be closely supervised so that devices may 
be used that will reduce or eliminate the harmful effects. 

The textile and clothing industries have, during their develop¬ 
ment of factory organization, been guilty of many abuses and 


656 ECONOMICS OF CLOTHING AND TEXTILES 


injustices to workers and to society. Among these abuses may 
be mentioned the following : 

(1) Long hours of labor. Originally the hours of work were 
excessive, in some cases extending from 5 : 30 or 6 a.m. to 6 : 30 p.m., 
at least twelve hours and in some cases more. These hours were 
due to the desire on the part of the manufacturers to carry on 
production as cheaply as possible with only two shifts of employ¬ 
ment a day. 

(2) Employment of women and children for night work. 

(3) Employment of workers at wages too low to permit a 
minimum standard of living suitable to their class in society. 

(4) Use of sweat-shop methods, by which piecework was done 
in unsanitary homes by women, men, and children. 

(5) Use of fines and penalties as punishments in the attempt 
to secure superior workmanship. 

(6) Seasonal unemployment because of irregular production. 

Unemployment. One of the greatest fears of the worker is 

unemployment, and thus loss of his means of existence. 

Unemployment is due to many reasons: (a) Seasonal employ¬ 
ment due to the change in styles, (6) introduction of automatic 
and higher production units of machinery for textiles and clothing, 
(c) business cycles — periods of prosperity and depressions which 
occur at definite periods of time. 

The recent invention of textile and clothing machinery has 
decreased the number of persons employed in that field. What 
is true of the textile industry is true of other industries as well, 
and the excess of workers in the United States today has reached 
enormous figures. 

Since unemployment is one of our greatest evils, drastic measures 
should be adopted to give work to as many people as possible. 
The five-day week is by no means the only work spreader. While 
millions of men are unemployed, the great bulk of workers in this 
country who still have jobs are putting in long days, many of them 
at the expense of their health. Shorter working days as well as 
shorter working weeks would contribute greatly to make the 
limited amount of work go around. 

Another way in which work can be spread is by reducing child 
labor. There has been no increase in unemployment among 


DISTRIBUTION OF THE SOCIAL INCOME 


657 


children. On the contrary, there has been a considerable increase 
in child labor during recent years. Fully a million children who 
should be at school have until recently been gainfully em¬ 
ployed. This is not only an economic anomaly; it is a national 
disgrace. In 1934 renewed effort was made to secure the ratifi¬ 
cation of a child labor amendment to the Constitution. 

One defect in the program for spreading work is that it does 
not increase consuming power. The same amount of money 
will be paid in wages to a larger number. It is far better for 
government and employers to spread work than to throw men 
on the street, where they must be taken care of through contribu¬ 
tions, public and private. 

But to insure steady consuming power unemployment insurance 
is necessary. We have been frightened by talk of the dole in 
connection with unemployment insurance. Actually there is no 
good reason why workers should not be insured against the loss 
of their jobs. We insure ourselves against everything else. Yet 
there is nothing, save illness and death, more important to 
a worker than his position. 

In 1931 the American Federation of Labor issued figures showing 
that there is in the United States, today, work enough to employ 
for thirty-five hours a week all those who are idle. The contention 
is, that if a seven-hour day and a five-day week were adopted 
in every industry, unemployment would literally vanish. The 
inference is that there is plenty of work in the United States for 
everybody if only it were divided up equitably. With the number 
of idle workers and the difficulty of finding jobs, it is hard to 
believe any such assertion during the depression. 

In most industries, the normal working week is forty-eight 
hours, scaling down to forty-four in many cases. Between that 
schedule and the thirty-five hour week there is no great gulf. Yet 
that small difference is enough to deprive of work something like a 
quarter of all our wage earners and to put long columns of red 
figures on the ledger of a vast number of industries. 

Before the depression came, we had several years of high pros¬ 
perity. During that time something might have been done to 
prepare for the coming of hard times which usually follow periods 
of prosperity. Working hours might have been readjusted so as 


658 ECONOMICS OF CLOTHING AND TEXTILES 


to divide the employment among a much greater number of 
workers. The high profits then made would have enabled indus¬ 
tries to do this without any great reduction of the individual 
incomes. 

Most progressive people define prosperity as the full employ¬ 
ment of labor at high real wages. Political tampering with the 
economic cycle is likely to remain hopeless as long as it fails to 
place emphasis on the welfare of the working population. 

In times of depression, when as many as 7,000,000 human beings 
are denied the right to work, business profits can not be satisfactory 
and financial risks can not be considered safe. Until the unem¬ 
ployed are redeemed from idleness insufficient buying power will 
continue to disorganize trade and industry. 

For some years industrial leaders of a certain type, as well 
as their trade organizations, calculated that by reducing wages, 
increasing prices through legislation, and displacing labor with 
machinery, they could increase their profits. This must have 
been predicated on the insane notion that with workers reduced 
in purchasing power — thrown upon the street — the demand 
for their products would nevertheless be maintained. 

The workers demand a five-day week ; and this is called drastic 
by many people. One petition for such a plan reads as follows: 

Instead of forcing working people into idleness during periods of eco¬ 
nomic recession, labor demands that such adjustments in the number of 
days worked per week and in the number of hours worked per day must 
take place so that all may share equitably in the amount of work available. 
Work security must be substituted for anxiety and unemployment. The 
management of industry which has failed so miserably must rise to new 
heights and assume new positions. 

Certainly if the displacement of man power by machinery is to be 
pushed at the present rate, Something of the sort is inevitable, unless we 
are prepared to gamble on the possibilities of having a vast army of 
chronically unemployed. 

Working people ... no longer concede to industry the right to provide 
work at will or to force millions of people into unemployment. They hold 
that the right to work is-a fundamental sacred right. 

Trade Associations and Labor Organizations. The questions 
of a living wage, fair wage, better wage, difference in wages, 


DISTRIBUTION OF THE SOCIAL INCOME 


659 


hours of labor, methods of protecting labor, strikes, lockouts, etc., 
are problems before us every day and affect, more or less, all 
of us. 

Certain devices for settling these problems in a peaceful manner 
have been worked out through the formation of trade associations 
and labor organizations. 

Labor organizations were formed in the United States over a 
century ago as labor unions representing workers of certain trades 
or divisions of a trade. Later these separate labor unions were 
invited into national organizations such as the American Federa¬ 
tion of Labor, which includes trade unions from many industries. 
The leading organizations in the textile industry are the United 
Textile Workers of America and the United Garment Workers’ 
Union. The textile industry and the clothing industry on the 
whole have been more or less opposed to organized labor. Many 
manufacturers have encouraged the employees to form organiza¬ 
tions or associations independent of the national labor organiza¬ 
tions. The textile and garment workers have not been organized 
as effectively as other industries. 

The trade unions are chiefly concerned with relations between 
labor and employers in their own industry. In addition many 
unions assist the families of workers by providing relief in times of 
distress and by various forms of insurance. The American Federa¬ 
tion of Labor strives (a) to improve the conditions of the working 
people by legislation, ( b ) to increase the sale of union-made goods, 
(c) to expand the idea of collective bargaining and peaceful picket¬ 
ing, (d) to assist in the formation of local unions. 

Employers and manufacturers have also formed associations to 
look after their interests with regard to : (a) legislation, ( b ) tariff, 
(c) standard prices, (d) arbitration, (e) standards of ethics and trade 
practice, (/) relations with labor. Some have assumed a friendly 
attitude to labor organizations and others have not. 

An establishment in which only union men may be employed is 
called a “closed shop.” If both union and non-union men are 
employed, it is called an “open shop.” 

The attitudes of both trade organizations and trade unions 
naturally reveal many of the characteristics of the individuals that 
compose them. Sometimes selfishness and greed predominate to 


660 ECONOMICS OF CLOTHING AND TEXTILES 


prevent their functioning in ways that will best serve the interest 
of society and industry. 

Trade organizations conducted wisely in the interest of both the 
producer and society at large, that is, the public, could be assured 
of all their potential advantages — such as uniform contract forms 
as an assurance of fair treatment to all, prevention of litigation by 
arbitration, elimination of seasonal work, etc., and at the same time 
safeguard against the disadvantages. The trade organizations 
would be assured of a considerable measure of confidence and 
support from the public or society in general for the solution of the 
problems between capital and labor. 

Both employers and workers have certain weapons that are used 
to settle disputes; but some of these are anti-social in their effects. 

Collective Bargaining. One of the causes of the frequent mis¬ 
understandings between the manufacturers and the workers is the 
difference in the bargaining power of each group. The worker is 
always at a disadvantage when he applies for work. He does not 
know how many workers are needed nor the compensation the man¬ 
ufacturer can afford. He does not know exactly what his services 
are worth, and he is compelled by necessity living on wages 
from day to day — to accept what the manufacturer wishes to 
give. 

Wages of workers were originally set by the manufacturers, who 
paid as little as possible. As time went on the workers organized 
into unions, and a representative of the union met the manufac¬ 
turers and agreed on a wage. This method of adjustment is called 
collective bargaining. If they were unable to agree, a strike was 
called and the workmen refused to go to work. Sometimes the 
question of wages is left to arbitration by a committee composed of 
a representative from the union, one from the manufacturer, and 
a third party agreed upon by the two groups. Differences fre¬ 
quently arise between the manufacturers and employees — par¬ 
ticularly the manufacturers of costumes — which cause a “ shut¬ 
down.” 

Strikes and Boycotts. Each national labor body has methods 
of compelling the industry and public to consider its grievances. 
The American Federation of Labor believes in strikes and boycotts 
as means of forcing employers to grant concessions to workers. 


DISTRIBUTION OF THE SOCIAL INCOME 


661 


A strike is a powerful weapon in the hands of labor, particularly 
at the beginning of a rush period of factory work. On the other 
hand, a lockout, the refusal on the part of the manufacturer to 
consider the demands of labor and to threaten to close down his 
plant until labor is willing to accept his terms, is very effective 
in times of depression. 

A boycott is a definite organized effort on the part of labor to 
reduce the sales of an employer who will not agree to their demands. 
If the commodity is widely used and the workers will organize, 
the boycott will be successful. A “black list’’ is a device 
used by manufacturers to keep disturbing factory employees 
from securing a position. While the black list device is illegal, 
nevertheless it is effectively used and it is difficult to prevent 
it. 

In connection with strikes, the workers frequently engage in 
picketing. That is, a group of workers stand in front of the manu¬ 
facturer’s place of business and notify workers and the public that 
the owner is “unfair” to organized labor. This is called peaceful 
picketing. 

By means of court injunctions it is possible for manufacturers 
to restrict the activities of the strikers. While peaceful picketing 
is legal, there are phases of picketing that are illegal, as shown 
in the following discussion. 

The distinction between legal and illegal strike picketing is 
clearly defined in a decision handed down upholding an injunction 
granted to pocketbook makers against the International Pocket- 
book Workers’ Union and 23 individuals. The dispute between the 
concern and its union employees had its inception in February, 
1931, when the workers, attempting to unionize the shop, called a 
strike. The manufacturer applied to the Superior Court for an 
injunction, alleging that strike pickets were intimidating their 
employees who remained at their jobs and were using unfair 
methods to persuade the workers to quit. The union and 23 indi¬ 
viduals were restrained in bonds of $5000 from threatening, 
intimidating, coercing, or annoying persons desirous of entering or 
remaining in the employ of the company. 

The firm manufactured pocketbooks and claimed to have an 
investment of $76,500 in its local factory and New York salesroom. 


662 ECONOMICS OF CLOTHING AND TEXTILES 


The firm asserted that its business would be ruined if the pickets 
were allowed to continue their activities. 

The union workers claimed in their appeal to the Supreme Court 
that intimidation or coercion can not be found to exist in the 
absence of actual physical violence or express threats of physical 
injury to persons or property. 

In respect to this allegation the Supreme Court said: 

Such assumption is not well founded. To intimidate is to inspire with 
fear, to overawe, or make afraid. Fear may be inspired without physical 
violence or spoken threats, moral intimidation may be accomplished by a 
menacing attitude and a display of force which may coerce the will as 
effectually as actual physical violence. 

The acts and conduct of the defendants were intimidating and coercive. 
Employees of the plaintiff were followed to and from their work. When 
entering and leaving the factory they were compelled to pass groups of 
strikers who gave them black and threatening looks. These groups at 
times contained as many as 20 strikers while the whole number of em¬ 
ployees restrained by the plaintiff did not exceed 35. 

This was a display of force which, with the inscriptions on the placards 
carried by the pickets indicating that the whole power of the American 
Federation of Labor was back of this strike, was well calculated to overawe 
and intimidate. It could have had no other purpose and actually had 
such effect, some of the employees requiring police escort to and from 
their homes. 

Cost of Strikes. The following figures show the amount of loss 
as a result of a clothing strike in New York in the spring of 1932. 
Since consumers must eventually bear this cost, the loss to society 
was very great. The strike resulted in approximately $50,000,000 
loss to the workers in wages and to the manufacturers in returns on 
products sold. The garment trade, a highly seasonal one, does an 
annual business of $300,000,000 over a ten- to fourteen-week work¬ 
ing period. The tieup, even for the limited period, affected Easter 
deliveries on the West coast and in mountain regions. 

Radical Labor Organizations. In addition to the regular trade 
unions connected with the American Federation of Labor, certain 
other labor groups of more radical character have grown up in the 
textile and garment trades. These organizations are usually con¬ 
nected with the I. W. W. (International Workers of the World) 


DISTRIBUTION OF THE SOCIAL INCOME 


663 


and other communistic bodies. These elements believe generally 
that the workers should control industry — i.e ., that each industry 
should be owned and managed by the workers in it. Followers of 
these theories have often worked among strikers in large mill 
centers and garment centers. They favor force, such as injury to 
machinery and destruction of product, in the attempt to accom¬ 
plish their aim, as well as the ordinary weapons of strikes and 
boycotts. 

Many of these communistic groups of labor pattern their beliefs 
on the plan of industry set up in Russia, where all means of pro¬ 
duction and all the products of the social income are pooled in a 
common body, in which each worker is entitled to a share. 

The Needle Trade Workers Industrial Union (communist) is in 
opposition in their actions to the International Ladies’ Garment 
Workers Union, affiliated with the American Federation of Labor. 

The communist groups have no collective dealings with organized 
employers of the industry. The officials of the American Federa¬ 
tion of Labor state that their actions are to divide and demoralize 
the workers, by opposing the labor unions. 

Peaceful Methods. The following methods have been used in 
settling industrial disputes between manufacturers and labor: 
(1) Trade agreements, signed by the owner and the employee, 
stating the wages, hours of labor, and working conditions for a 
definite time — year or more. (2) Conciliation, consisting of con¬ 
ferences between committees composed of members of the union 
and representatives of the employers; these conferences attempt 
to settle differences involving conditions of employment. (3) Me¬ 
diation : if the union and employer fail to come together as outlined 
under (2), a third party, usually a public officer or representatives 
of the Chamber of Commerce, attempts to bring the two parties 
together as under (2). (4) Compulsory investigation or arbitra¬ 

tion, under which grievances must be submitted to a government 
Board of Investigation before engaging in a strike or lockout. 
(5) Voluntary arbitration; when other measures, outlined under 
(3) and (4), fail, the interested parties may submit the questions 
at stake to a third party. (6) Compulsory arbitration: in some 
communities all questions between labor and manufacturers must 
be submitted to an impartial board of arbitration. (7) Shop 


664 ECONOMICS OF CLOTHING AND TEXTILES 


committee or workers’ council: a committee or council is appointed 
or elected by the workers to discuss with the officials and employers 
all questions of shop management, wages, hours of service, etc. 
Under (7) the union is not considered, but only those workers 
immediately concerned. Of course, the union claims that the 
workers, being inexperienced in dealing with manufacturers, are at 
a disadvantage in such cases. 

Welfare Work for Employees. One of the most serious problems 
today that confronts the industrial world is the discontent and 
unrest of the workers in the trades and industries. This is due 
in a measure to the overgrowth of the present industrial condition 
of highly specialized work that has made the worker in some cases 
a mere attachment of a machine. Modern engineering has devel¬ 
oped the machine part of industry at the expense of the human 
factor. To illustrate : Modern shop systems in general have been 
organized so as to allow to each machine a definite earning capacity 
that is expressed in the form of a daily or hourly machine rate. 
Machines represent the investment of large sums of money, and 
therefore must be kept at work all of the time in order to justify 
the expenditure involved in their purchase. If a machine, for any 
reason, is allowed to stand idle, the charge against it mounts up, 
and it becomes a burden instead of being a useful and productive 
investment. In the attempt to develop the efficiency of the 
machines, many manufacturers and tradesmen have lost sight of 
the fact that the worker is human and demands consideration. 

The progressive manufacturers have seen this spirit of unrest 
growing among the employees and have attempted to assist them 
in various ways which are usually grouped under a heading called 
“ welfare work.” A specially trained person called an employment 
manager is usually selected to employ workers and look after their 
welfare. This welfare work has failed in some cases because it 
conferred benefits upon a group of workmen, requiring and asking 
no service on their part. 

Cooperative Industry. At the time of the establishment of the 
factory system, the employee worked all the time for the employer 
and received compensation in the form of wages. Today there is 
a strong feeling that the improvement of the employee’s condition 
must go on. While the wage system has certain advantages and 


DISTRIBUTION OF THE SOCIAL INCOME 


665 


certain disadvantages, it may be that a system of cooperative 
relation between the employer and employee will in the future take 
the place of this in industry. Under this system the worker will 
share in the profits and assist in the management of the plant 
through committee representatives. 

Under such an arrangement, a certain percentage of the profit 
is turned over to meritorious workers. Half of this amount is 
given in cash and the other half in stock, so that the recipients 
become partners in the business. The workers are rated with 
merits and demerits as their performance warrants, much in the 
same way that the merit card system is applied in school. If at the 
end of the year one employee receives more than another, he knows 
why. All in all, the scheme puts the employees on their mettle. 
They take more interest in the business because they know it will 
benefit them as well as their employers. 

The partnership plan is based on the following theory: The 
corporation is made up of three groups: (1) The manufacturing 
group in the factory, (2) the selling and administrative group, such 
as salesmen, officers, accountants, clerks, etc., and (3) the investing 
group, which furnishes the property and the capital to operate. 
These three groups, in effect, constitute a partnership. In a 
partnership each partner shares responsibility, each is entitled to 
know what the other partners are doing, and all partners are 
entitled to share in the profits in proportion to their interest. 

Proceeding on this theory, the directors of one company made this 
proposition to the workers : Elect your own board of operatives — 
a member from each branch of the industry — to represent the 
interest of the workers. It will carry your grievances to the 
management; it will manage the houses owned by the company and 
in which you live; it will initiate and manage any educational and 
recreational work among the employees or in the community. 

Such cooperative methods will eliminate many causes for indus¬ 
trial conflict. 

Socialism. Followers of the theory of socialism contend that 
the employer appropriates a good part of the increased value of 
manufactured goods, which is due to the labor of the workman on 
raw material; and out of this part appropriated he receives too 
large a share of the social income. 


666 ECONOMICS OF CLOTHING AND TEXTILES 


Socialism advocates the government ownership of all property 
that is or may be used in producing wealth. This really means 
the management and control of all business by the government. 
While many people believe that there is some justification for the 
government to control streets, streams, harbors, schools, commerce, 
post offices, water power, monopolies of the necessaries of life, — 
such as coal, oil, express, freight, trolley, railroad, ice, timber-land, 
etc. — it is generally believed that any wholesale attempt for the 
state to take up ownership of complicated industry would fail 
financially and private enterprises would be destroyed. Even the 
attempt on the part of the government to assume control of public 
utilities should be done slowly so that the community may be able 
to assume responsibility by developing a strong cooperative 
spirit. 

The objections to these socialistic programs for the betterment of 
society and industry are many. The following are the principal 
ones: 

(1) The chief objection to socialism is that it is too theoretical 
and fails to consider human nature in all its aspects. While there 
is the instinct of cooperation in mankind, there are also other 
instincts like selfishness or self-interest. We can not consider any 
one instinct alone and ignore the others. The weakness of social¬ 
ism is that it assumes that mankind is cooperative to the nth degree 
and that self-interest may be stifled — which is not to be. Self- 
interest or selfishness is a vital force in all of us and particularly in 
industry it is the vital force that moves us ahead. Hence any 
attempt to destroy self-interest completely will also destroy the 
progressive development of industry. Socialism fails to consider 
the characteristics of human nature as outlined in Chapters II and 
III. Man is inclined to be intensely selfish and not willing and 
ready to work to his greatest capacity for the pleasure of helping 
or assisting his fellow man. The history of the human race shows 
time and time again that people do not invent and work hand in 
hand unless they see and can receive rich prizes or rewards for 
their efforts in the form of leadership, good name, money. 

(2) In order that work be done efficiently, it is necessary to have 
leaders or managers who can plan, supervise, and direct the work. 
Human nature is such that it would prefer to give rather than to 


DISTRIBUTION OF THE SOCIAL INCOME 667 

take orders. Hence under socialism too many would attempt to 
become leaders, and the result would be inefficiency. 

(3) No one would care of his own accord to do the menial work 
of industry. Hence the distribution of human talent would cause 
much discontent and jealousy. 

(4) It would destroy individual freedom, as everything would be 
done by the government or by committees of workers. 

During periods of the depression in the world many people 
believed that agencies such as the government could coordinate 
industry to advantage. 

Government and Taxes. A large amount of the world’s wealth 
is consumed in the support of the national, state, and local gov¬ 
ernments. The various methods of raising and distributing the 
necessary funds compose what is known as public finance. The 
money collected by the government for its support is called taxes. 

Taxation may be justified for the following reason : Government, 
whether national, state, or local, is one factor in the process of 
production, because government bodies maintain the rights of 
business men to do business ; they protect contracts, trade-marks, 
patents, etc.; they regulate health, safety, sanitary conditions; 
regulate hours and wages in some industries; restrain destructive 
trade practices and unfair competition; maintain tariff protection; 
and facilitate production through trade information, consular 
service, etc. For these services the government is entitled to a 
return in the form of taxes. Furthermore, that portion of the 
social income returned to the government is to be used for the pub¬ 
lic welfare, and hence is dispensed for the benefit of all classes. 

It is important that the local, state, and national government 
of a country, particularly the local, should be favorably disposed 
toward industrial progress. Manufacturers and business men 
are willing to invest their wealth in a plant that is located in a com¬ 
munity favorably disposed toward the industry. 

Public Finance. Since the government has assisted the develop¬ 
ment of all kinds of production in addition to looking after the 
welfare of the members of society, it is only natural that it should 
receive a portion of the created wealth so that it may continue to 
perform those duties that are necessary for the government to 
undertake. 


668 ECONOMICS OF CLOTHING AND TEXTILES 

Public finance through taxes provides by the government: 
(1) protection and safeguarding the health, (2) education of physical 
and mental abilities of the individual, (3) facilities for stimulating 
and protecting industry and general prosperity. No one industry 
has received more assistance than the clothing and textile trades, 
as shown by the following : (a) police and fire protection, (b) health 
protection and disease protection, ( c ) factory regulations and pro¬ 
tection to the worker, (d) public improvements — streets, parks, 
etc., (e) education — both general and vocational, free of cost. 

Our government has always given encouragement and protection 
to the clothing industry through enactments of laws and tariff 
regulations. The colonies enacted laws for the encouragement 
of wool-growing and manufacture. Efforts were also made at an 
early date to encourage weavers and artisans to come from foreign 
countries and establish the beginning of the factory system by 
building and operating woolen-goods mills, thus supplementing 
the results of domestic manufacture. They so increased in the 
following century that the carding, weaving, and spinning of wool 
and the dressing of cloth became general in all the colonies before 
the War of the Revolution. 

As the friction between the mother country and the colonies 
became intense, a patriotic impulse for the wearing of homespun, 
and the discarding of English-made goods, became general. It is 
said that the Harvard graduating class of 1770 appeared in black 
broadcloth of New England manufacture. Similar patriotic 
impulses actuated professional and business men, and women vied 
with one another in their patriotic devotion to homespun textures. 

In 1785 a medal was offered by a South Carolina society for the 
first flock of merino sheep kept in the State, but it was eight years 
before the first sheep of that breed was imported into any other 
State. President Washington was an importer of improved Eng¬ 
lish sheep, and many prominent Virginians took an active interest 
in the development of the sheep industry. 

In the other colonies the public men were ever the friends of wool¬ 
growing. It was a subject of vital interest to all, as clothing, next 
to food, is the greatest physical want of humanity. Cotton was 
scarce and high, and wool for the winter, as flax for the summer, 
was an admitted necessity of existence. Public men, almost 


DISTRIBUTION OF THE SOCIAL INCOME 


669 


without exception, were favorable to the encouragement by legis¬ 
lation, by premium and bounty, of the manufacture of wool. 

This early protection and encouragement of the textile and 
clothing industries in America has been continued as the industries 
became more 
complex. Per¬ 
haps one of the 
most important 
services that 
have been ren¬ 
dered by the 
government 
bodies is the 
support of voca¬ 
tional and indus¬ 
trial training for 
textile workers. 

Industrial 
Education. The 

progressive development of all textile trades and industries demands 
the training of a group of skilled workers who may act later as 
foremen. The future skilled workers must be trained. Industrial 
conditions today differ very greatly from those of earlier times; 
trade and industry are more ambitious, more successful, and more 
scientific, than ever before. Years ago they were too simple for 
intellectual study. Now they require the highest forms of study 
and demand the best intellects. 

Industrial education in the textile trades may be advocated 
because of the increased earning power it affords. The salary of 
a person is determined by certain factors which may be divided 
into two groups, — those pertaining to the individual and those 
pertaining to the organization. The individual group includes 
such factors as natural ability, proper development of the body, 
cultivation of honesty and morality, which are by-products of 
general education and industrial education. The factors that enter 
into the organization group are capital, up-to-date appliances, 
leadership, proper allowance for depreciation, etc. One of the 
chief factors that will increase the productivity of the individual is 



Costume Illustration Room in a Trade School 




670 ECONOMICS OF CLOTHING AND TEXTILES 


industrial education. Increased productivity will enable the coun¬ 
try as a whole to increase the standards of living, and the worker 
will be able to have some of the luxuries of life as well as the 
necessities. 

To summarize: It is to the interest of society, labor, and capital 
to have the most effective system of industrial education. Properly 
trained workers (labor) increase the production. From the 
workers’ point of view, physical energy and knowledge represent 
the workers’ capital, and the greatest return to the worker, in addi¬ 
tion to personal satisfaction, comes only through an efficient system 
of industrial education. Society profits when every member has 
rendered his greatest contribution. 

Taxation. The government of a country and its subdivisions — 
state and local communities — is supported by various forms of 
taxes. The expenses are carefully prepared in a statement called a 
budget, and the money necessary to equal the budget must be 
raised in various ways by taxation. There are at least three 
forms of taxes: (a) Federal, (6) State, and (c) local community 
tax. 

The government has two ways of securing money — taxation 
and bond issues. But government has only one source of revenue 
and that is taxation. When a government borrows money to meet 
its obligations, it simply defers the payment of those obligations. 
In reality, governmental borrowing means governmental expendi¬ 
ture upon the installment plan; it actually constitutes a mortgage 
on the taxes of the future. 

Taxes are imposed upon the following theories: that each indi¬ 
vidual should pay in proportion to the benefits he receives, and 
that taxes should be proportionately divided according to the abil¬ 
ity to pay. In addition, taxes should be conveniently imposed, 
easy to collect, definitely placed, and should not be high enough 
to discourage any industrial undertaking or enterprise. 

All taxes are either of a direct or an indirect type. Direct taxes 
are those imposed and borne by the persons who pay them, such as 
poll taxes, inheritance taxes, etc. Indirect taxes are those that 
are shifted from the person on whom they are first imposed to the 
final consumer. To illustrate: Taxes on manufactured goods, 
costumes, etc., are added to the final price paid by the consumer. 


DISTRIBUTION OF THE SOCIAL INCOME 


671 


It may be good politics to talk about shifting the tax burden 
from the individual to industry and business, but such discussion 
actually means little. In the final analysis, the tax burden of this 
country falls upon the consumer. It forms a part of the cost of 
living of every citizen — the farmer, the home owner, and the 
wage earner. 

The taxes upon real property are the easiest to enforce and the 
least flexible of all taxes. The tendency under pressure of need 
to continue these unchanged in times of depression, despite the 
decrease in the owner's income, places an undue burden upon that 
portion of the community in which real estate is the chief property 
item. The tax burden upon real estate is wholly out of proportion 
to that upon other forms of property. 

Sales Tax. A sales tax — that is, a small tax of two per cent 
or three per cent on producers' sales of all kinds of commodities 
— has been advocated for many years. The principal source of 
revenue for communities has been the tax on land and buildings, 
and since it has been inadequate a sales tax has been suggested. 
Objections have been made to sales tax by both producers and 
consumers. The producer feels that the sales tax will decrease the 
possible sales and require much additional labor in keeping records. 

Reduction of Taxes. There is a tendency on the part of social 
welfare committees and organizations to urge the government 
to assume a paternal interest in many problems. They do this on 
the assumption that all individuals exist for the state, and that 
the government should exercise a paternal interest in the home, the 
farm, the factory, the child, the worker, etc. 

During prosperous times the government has organized bureaus 
and departments for supervision of this work. People become 
accustomed to the paternal interest and “gifts" of the government. 
Then in times of depression human nature finds it difficult or doubly 
hard to save after the long period of extravagance. In like meas¬ 
ure, governments compelled to cut down expenses are inclined to 
cling to their accustomed luxuries. Economy in general is popular, 
but economy in detail is distasteful. 

As a people, we admit that government budgets must be balanced 
and public credit maintained. But as individuals we now disclaim 
all personal responsibility for governmental extravagance, and we 


672 ECONOMICS OF CLOTHING AND TEXTILES 


are looking for an opportunity to shift our share of the burden. 
This is characteristic of human nature — let the other man do it. 

The share of income devoted to tax charges has been steadily 
increasing. Before the War, theoretically, every man worked 25 
days a year for the national, state, and local governments combined. 
In 1924 he worked 46 days a year. Today he works for the support 
of all forms of government 61 days out of a year. Another way 
of expressing the amount devoted for taxes out of the amount earned 
is to say that one dollar out of every five earned today is going to 
250,000 tax-gathering and tax-spending agencies. 



Government Expenses in the United States 


Often because of policies introduced during prosperous times 
we find that expenditures by government in times of depression 
constitute such a large proportion of the national income that 
citizens are deprived of the purchasing power necessary to a revival 
of business activity. When the government reduces taxes, its citi¬ 
zens will have more money for the purchase of goods and services. 
Agriculture and industry will have more money for the employment 
of labor and for the purchase of materials and supplies. 

We frequently encounter the familiar and fallacious argument 
that a government can be run along the lines of a private business, 
and that its operations should be adjusted to changes in economic 
conditions by adopting the methods of private employers. As a 
























































DISTRIBUTION OF THE SOCIAL INCOME 


673 


matter of fact, the gap between private and public business is large. 
The former, run for profit, is forced to adjust its scale of operations 
to the state of public demand, and when times are bad, its outlays 
for wages, supplies, etc., decline accordingly. Governments, on 
the contrary, usually find that the demands made upon them are 
greatest when economic activity is at a low ebb, so that efforts to 
economize may be least successful when the need of sparing the 
taxpayer is greatest. Nevertheless a definite effort should be 
made to curtail government expenses in times of depression, as 
there is little merit in the idea that extravagant governmental 
expenditures and high taxes will produce sound and healthy busi¬ 
ness conditions. 


QUESTIONS 

1. What is meant by the expression “ social income ” ? Explain in 
detail in terms of the textile and clothing trades. 

2. (a) How is the social income distributed ? ( b ) Why is the problem 
of the distribution important and difficult? 

3. State the reasons for each factor of production receiving its shares. 

4. What is meant by the expressions: (a) national wealth? ( b ) per 
capita wealth, (c) national income, ( d ) per capita income? 

5 . Describe the items included in the national wealth. 

6. Why must the income to various factors change in response to in¬ 
dustrial conditions? 

7. Roughly speaking, state the percentages due (a) labor, ( b ) over¬ 
head, ( c ) raw materials in the clothing trades. 

8. (a) Describe the meaning of Ricardo’s Iron Law of Wages. 
(6) Does it work exactly in all cases in all countries ? 

9. Why should wages and salaries differ for different classes of 
workers? 

10 . Describe briefly different classes of workers, and state their con¬ 
tributions to the production of textiles and clothing. 

11 . Explain how the supervisory officers differ from workers in the 
contribution to the production of textiles. 

12 . Describe the different types of workers and their qualifications. 

13 . Give approximately the number of different types of workers 
employed in (a) textiles and ( b ) shoe factories. 

14 . Describe the types of textile work that are most attractive. Ex¬ 
plain. 

15 . Why are juvenile workers employed in textile mills? 


674 ECONOMICS OF CLOTHING AND TEXTILES 


16 . We hear much of the expression “ capital and labor.” Explain 
in detail and state why there are constant disagreements between them. 

17 . Explain how capital and labor assist in textile production. 

18 . Why is office (secretary) work usually considered superior to 
machine work (weaver) in the mill? 

19 . State the duties and rights of capital and labor. Do the rights 
change from time to time? Explain. 

20. Is labor a commodity in a strict economic sense? 

21. When does labor have the highest efficiency? 

22. Have the textile and clothing manufacturers always treated labor 
with justice? Explain in detail. 

23 . Why is unemployment very common in the textile and clothing 
trades? 

24 . State the advantages and disadvantages of trade organizations and 
labor organizations. 

25 . Explain: (a) collective bargaining, (6) boycott, (c) strike, ( d ) peace¬ 
ful picketing and its effect on industry and society. 

26 . Give examples of the cost of strikes to society in general. 

27 . Name some of the radical labor organizations and their effective¬ 
ness in assisting labor. 

28 . Name some of the principal methods of settling differences between 
labor and capital. 

29 . What is meant by the expression “welfare work for employees.” 
Does it assist both labor and capital? 

30 . What is meant by the expression “cooperative management of 
industry ” ? 

31 . (a) What is socialism? ( b) State its history, (c) Has it assisted 
labor, society, or capital? 

32 . State the advantages and disadvantages of socialism. 

33 . (a) What is the relation between government and industry? 
(6) State the ideal relation. 

34. (a) How does industry assist the government? ( b ) Enumerate 
the different methods of assisting the government. 

35. Explain the public finance system of the country. 

36 . State the advantages of industrial education. 

37 . What is meant by taxation applied to labor and capital? 

38 . Explain the theory of taxation and the different methods. 


INDEX 


Abuse of trade-marks, 604 
Acceptance of orders, 637 
Accounting, 504 
Accounts receivable, 510 
Acquired traits, 39 
Administration, 523 
Cost of, 523 

Admission of imports, 380 
Adornment of body, 46 
Advantages of commodity .exchange, 
345 

Advertising, 600 
Advantages, 600 
Appeal, 610 
Campaigns, 633 
Characteristics, 598 
Ethics, 631 
Importance, 598 
Mediums, 610 
Magazines, 614 
Mail, 615 
Newspapers, 612 
Trade Journals, 615 
Types, 602 
Air mail, 594 
Air transportation, 593 
Alligation, 525 

American Federation of Labor, 657 
American methods of manufacture, 
266 

American standard of living, 74 
Appreciation, 31 
Arbitrage, 312 
Arbitration, 637 

Arbitration committees, 563, 668 
Artificial indigo, 430 
Art of clothing, 45 
Assets, 510 


Association of ideas, 32 
Attention, 32, 38 
Authority, 88 
Automatic inventions, 483 

Balance of trade, 360 
Balance sheets, 509 
Bank notes, 396 
Bank reports, 405 
Bank reserve, 409 
Bankruptcy, 210 
Banks, 396 
Bargaining, 660 
Bartering, 172 
Bimetalism, 389 
Biology, 427 

Birth rate in the United States, 100 

Blending raw materials, 525 

Boat rates, 596 

Bonds, 210 

Book credit, 393 

Bookkeeping, 505 

Borrowing capacity, 211 

Boycotts, 660 

Branded products, 603 

Broker, 285 

Budget payment plan, 354 
Budget sheet, 137 
Business, 16 

Business cycles, 543, 556 
Business ethics, 89, 623 
Business failures, 568 
Business management, 16, 19, 204 
Business organization, 78, 202 
Business problems of industry, 59 
Business units, 223 

Bureau of Foreign and Domestic 
Commerce, 382 


675 



INDEX 


676 

Bureau of Standards, 646 
Buyers of raw cotton, 307 

Call money market, 421 
Capital, 15, 510 
Classes of, 214 
Circulating, 16 
Fixed, 16, 214 
Free, 16 
Funds, 215 
Goods, 15, 214 
Specialized, 16 
Carpets, 64 
Cellulose acetate, 440 
Cheap wearing apparel, 110 
Checks, 394, 403 
Chemistry, 427 
Child labor, 272 
Children’s clothing, 128 
Claims and allowances, 636 
Classes of people, 28 
Classification of workers, 648 
Cleaning association, 344 
Clearing house, 403 
Clothing, 1, 22, 45, 52, 69, 107, 116, 
124, 144, 146, 160, 244 
Discarded clothing, 150 
Uses for cast-off clothing, 149 
Clothing establishments, 238 
Coal-tar dyes, 429 
Cocoons, 446 
Code of ethics, 87 
Codes, 560 

Collective bargaining, 660 
Color, 24 
Color charts, 453 
Commercial banks, 415 
Commission merchant, 284 
Commodities, 5, 6 
Commodity exchange, 302, 345 
Common law, 89 

Comparison of foreign and domestic 
organizations, 267 
Competition, 10, 269 
Competition from motor transpor¬ 
tation, 587 


Consolidation of railways, 587 
Consumers, 105, 109 
Consumers’ goods, 8 
Consumers’ protection, 148 
Consumers’ surplus, 107 
Consumption, 7, 103, 118 
Contraction, 557 
Contracts, 872 

Control of credit and price, 557 
Converter, 285 
Cooperation, 38 
Cooperation of business, 560 
Cooperative advertising, 620 
Cooperative industry, 664 
Cooperative organizations, 211 
Cooperative students, 259 
Coordination of merchandise, 622 
Coordination of senses, 26 
Corporations, 207 
Copyright, 489 
Cost of advertising, 606 
Cost finding, 504 
Cost finding practices, 516 
Cost of production, 520 
men’s clothing, 520 
shoes, 521 
strikes, 662 
Cost system, 526 
Costumes, 46 
Costume design, 50 
Cotton, 164, 305, 307, 310, 317, 320, 
361, 362, 363, 430, 560 
cloth, 320 
crop outlook, 314 
Finishers’ Association, 586 
industry, 577 
manufacture, 175 
market, 312 
quotation, 321 
research, 430 
trade, 361 
yarn, 320 

Credit, 387, 393, 424, 635 
expansion, 557 
function, 407 
Crime, 565 





INDEX 


677 


Crompton’s spinning mule, 471 
Culture, 67 

Cultural development, 43 
Cuprammonium rayon, 439 
Curiosity, 38 
Currency inflation, 557 
Custom, 65 
Customary prices, 113 

Deferred assortments, 637 
Deflation, 391, 557 
Deliveries, 636 
Demand, 11, 220, 391 
Department store, 288 
Departmental organization, 256 
Depreciation, 522 
Depression, 7, 543, 546, 558, 561 
Cause of, 544 
Period, 546 
Types of, 344 

Depression in textile industries, 
573 

Designs, 489 
Costume, 501 
Piracy, 489 
Protection, 489 
Registration, 490 
Determination of price, 300 
Diagrams, charts, and graphs, 534 
Differences between manufacture and 
labor, 562 

Dignity of industry, 653 
Direct distribution of overhead, 523 
Discount function, 401 
Display, 39 
Distribution, 11, 17 
Distribution of national income, 
642 

Division of labor, 79 
Domestic life, 69 
Domestic raw silk waste, 90 
Domestic system, 174 
Draft, 394 
Draw loom, 171 
Dress, 29, 62 
Dyestuff market, 303 


Economical consumption of clothing, 
146 

Economical selection of clothing, 
141 

Economics, 2, 57, 103 
Aim of, 2 
Application, 3 
Economic freedom, 11 
Economics for the consumer, 103 
Effective salesmanship, 356 
Effects of mass production, 252 
of mixed population, 95 
of specialization, 251 
Efficiency, 226 
Efficiency methods, 574 
Egyptian cotton, 363 
Elements of success, 228 
Elimination of inefficient units of 
production, 367 
of the middleman, 294 
Emotional appeal of cloth, 47 
Emotions, 22, 40, 51 
Employment procedure, 256 
of married women, 256 
of minors, 256 
Engel’s law, 119 
Entrepreneur, 16, 204, 217, 641 
Environment, 28 
Esprit-de-corps , 254 
Ethics, 87, 89 

European textile factories, 190 
Excess capital, 15 
Exchange, 8, 279, 417 
Marketing, 8 
Principles of, 9 
Expansion, 557 
Expenses, 515 
Extroverts, 29 

Fabrics, 433, 436, 479 

Factoring, 419 

Factors, 120, 284 

Factors of society, 65 

Factory expense, 519 

Factory system, 187, 189, 222, 250 

Family life, 79 


# 



678 


INDEX 


Fashion, 49, 495 
Fear, 38 

Federal Census Bureau, 562 
Federal Trade Commission, 623, 
625 

Feeling, 40 
Felting, 160 
Feudal period, 168 
Fiat money, 370 
Fibers, 437 

Final consumption, 8, 103 
Financing, 347 
Financing of wool trade, 332 
Finisher’s dispute, 595 
Finishing, 285 
Finishing instructions, 537 
Fixed charges, 517 
Flax, 161 

Foreign exchange, 397 
Foreign obligations, 396 
Freight interchange, 592 
Freight rates, 580 
Freight tariff, 591 
Full cost, 511 
Fundamental principles, 1 
Future cotton, 317 

General functions, 255 
General textile research, 456 
German shoe manufacturing, 267 
Gold, 388 

Government, 17, 667 
Government expenses in United 
States, 672 

Government interference, 559 
Government notes, 396 
Grading of cotton, 305 
Grading of silk, 339 
Graphs, 18 
Gregariousness, 39 
Gross cost, 511 
income, 515 
profits, 515 
selling price, 511 
Group buying, 287 
Guilds, 172 


Habit, 30 

Handicrafts, 169, 250 
Handicraft stage and action, 173 
Hand-loom, 71 
Hearing, 25 
Hedging, 318, 346 
Heredity, 27 
Hosiery industry, 449 
Howe’s sewing machine, 481 
Human desires, 22 
nature, 40 
traits, 27 

Ideas, 32 

Idle equipment, 581 
Imitation, 37 
Immigrants, 92 
German, 93 
Irish, 92 

Importance of our import trade, 382 
Importance of small business man, 565 
Imports, 380 
Income, 7, 639 
Income tax, 554 

Increased knowledge of business con¬ 
ditions, 556 
Index numbers, 114 
Indirect labor, 517 
Individual rights, 82 
Industrial centers, 212 
Industrial education, 669 
promotion, 433 
Research Bureau, 563 
revolution, 178 
Industry, 169, 253, 653 
Inflation, 391, 557 
Injury of workers, 262 
Installment buying, 355 
Instincts, 38 

Integration of business units, 223 
Intellect, 22 

Intelligent purchasing of clothing, 144 
Interest, 13, 33, 640 
International trade, 359, 383 
Interstate Commerce Commission, 
583, 586, 592 






INDEX 


679 


Introverts, 29 

Invention of automatic machinery, 
483 

Inventions, 81, 468 
Inventory, 510 
Investment banker, 416 
Invoice, 505 

Jacquard loom, 474 
Japanese filatures, 448 
Jewelry, 111 
Jobber, 285 
Judgment, 34 

Knitted fabrics, 433 
Knitting machines, 477 

Labor, 13, 211, 230, 455, 517, 519, 652, 
653 

Laboratories, 457 
Labor conditions, 655 
Labor organizations, 658, 662 
Labor turnover, 261 
Laissez-faire, 85 
Land, 122, 211 
Law, 88 

Law of diminishing utility, 5, 118 
of harmony, 118 
of imitation, 118 
of variety, 118 

Laws of the consumer’s dollar, 
119 

of consumption, 118 
Leather trade, 111, 373 
Ledger, 508 
Legal right, 82 
Legal tender, 390 
Liabilities, 510 
Liberty in business, 268 
Linen, 435 

Linen manufacture in the United 
States, 196 
Linen trade, 361 
Logic, 22 

Long-range planning, 536 
Looms, 71, 158, 171, 473 


Loss, 511 

Love of the beautiful, 39 
of distinction, 38 

Machine age, 188 
cost per hour, 518 
spinning, 182 
Magazine advertising, 614 
Mail advertising, 615 
Malthusian theory, 97 
Man a social being, 61 
Manufacturing costs, 516 
Marginal consumer, 105 
producer, 106 
utility of clothing, 105 
Marketing, 9, 172, 279, 320, 645 
cotton yarn and cotton cloth, 320, 
324 
silk, 337 

thrown and spun silk, 340 
Market prices, 267 
value, 10 

Mass production, 550 
Material cost, 517 
direct, 517, 519 
indirect, 517 
Materials, 517 
for clothing, 160 

Mechanical preparation of flax, 434 
Merchandise inventory, 510 
Merchandising research, 454 
Merchants, 280 
Mergers, 570 
Methods of payment, 421 
Methods of selling wool, 327 
Middleman’s services, 280, 281, 282, 
295 

Millinery, 242 
Mill selling agent, 283 
Mixed population, 95 
Modern methods of repairing shoes, 
236 

Modesty, 31 
Money, 387 

Monopoly of machines, 234 
I Monopoly prices, 299 



680 


INDEX 


Motor transportation, 589 
motor bus, 591 
motor truck, 591 
Mulberry leaves, 444 
Mule frame, 471 

National banks, 400 
National cotton week, 620 
National income, 642 
National Industry Recovery Act, 560 
National Recovery Act, 271 
National wealth, 641 
National law, 82 
Net cost, 511 
profit, 515 
selling price, 511 
Newspaper advertising, 612 
New type business man, 562 
Nitrocellulose, 430 
Normal price, 112, 298 
Notes, 401 
Novel fabrics, 436 

Open accounts, 507 
Opposing theories, 59 
Optimism, 555 

Organization of a cotton mill, 225 
of Industrial Relations Bureau, 257 
Original ideas, 37 
Overhead charges, 517, 522 
Over-population, 99 
Over-production theory, 549 

Packaging, 616 
Pan-American Airways, 593 
Panic, 51 

Partial consumption, 103 
Partnership, 207 
Par value, 20 
Patents, 461, 462 
Patent Office, 462 
Paternalism, 85 

Peaceful methods of settling industrial 
disputes, 663 
Percentage of costs, 520 
Period of crisis, 546 
depression, 546 


prosperity, 545 
recovery, 547 
Personalities, 29 
Pessimism, 555 
Physics, 427 
Political theory, 549 
Postal savings, 419 
Power age, 189 
costs, 524 
loom, 476 

Predatory price cutting, 627 
Preferred stock, 209 
Present problems, 97 
Price, 10 
Deflated, 112 
Inflated, 112 
Market, 112 
Moderate, 120 
Normal, 212 
Price-cutting, 626 
index, 15 

groups in clothing, 107, 120 
Prices, 113 
Cost, 113 
Customary, 113 
Full, 113 
Initial, 113 
Prime cost, 511 

Principles of management and business 
methods, 221 
Private banks, 416 
ownership of property, 79, 80 
Problems, 152 
Producers’ goods, 8 
Production, 7, 218 
primary factors, 211 
secondary factors, 211, 645 
Production agencies, 584 
costs, 515 

Productive consumption, 8 
Productive labor, 517 
Progressive change, 94 
Profit, 16, 511, 513, 555 
Profit and loss, 511 
Progress, 72 
Promissory notes, 393 




INDEX 


681 


Prosperity, 7, 120, 545 
Psychological importance of clothing, 
22 

Psychology, 22 
Public opinion, 16 

Qualifications of a trader, 291 
Quality, 108 

Quality control plan, 629 
Quantity of money, 392 
Quotations on cotton yarn, 321 
on silk, 339 

on wool top futures, 334 

Radical labor organizations, 662 
Railroad rates, 596 
Railway Express Agency, 592 
Railways, 585, 587 
Rate cutting tactics, 589 
Raw cotton, 307 
Raw Silk Exchange, 341, 342 
Raw silk waste rules, 90 
Rayon, 438, 440, 442 
industry, 579 

Ready-to-wear clothing, 244 
Receipts, 637 

Recent changes in mill design, 262 
Rediscount, 410 

Reducing cost of marketing, 294 
Reduction of taxes, 671 
Reeling raw silk, 167 
Regulating costs, 524 
Rejectments and replacements, 637 
Relaxation, 4 
Religion, 39 

Religious influences, 47, 86 
Rent, 12, 13, 640 
Research in silk production, 443 
Research work, 427, 432, 454 
Resident buyers, 287 
Resort fashions, 48 
Restricted employment, 258 
Retail selling, 109, 332 
stores, 288 
Reserve fund, 510 
Ricardo's Iron Law of Wages, 644 
Rights of labor and capital, 654 


Ring spinning frame, 472 
Rivalry, 10, 38 
Roving frame, 184 
Rubberized fabrics, 479 
Rubber research, 453 
Rugs, 375 

Salesmanship, 286, 356 
Sales tax, 671 
Savings banks, 412 

Science of clothing in textile business, 2 
Selective distribution, 290 
Selling, 352 
agents, 282 
costs, 523 
Sentiment, 41 
Sericulture, 444 
Services, 5, 6, 109 
Servisilk, 624 
Sewing machine, 482 
economic importance, 482 
social importance, 482 
Sherman Anti-Trust Law, 561 
Shifting centers, 213 
Shinshu raw silk, 448 
Shipping instructions, 536 
Shoe manufacture, 230, 521 
repairing, 236 
styles, 499 
Sight, 23 

Silk, 165, 371, 443, 451, 560 
Silk industry, 576 
Silk raising in America, 193 
Silkworm, 444 
Silver, 388 

Single business man, 205 
Size of mill, 529 
Skill, 30 

Small industries, 253 
Smell, 25 

Social development of clothing in 
United States, 92 

Social effects of business cycle, 564 
income, 639 

influence of clothing, 68 
mind, 65 




682 


INDEX 


Social monopolies, 80 
organizations, 77 
rights, 82 
science, 57 
standard wage, 77 
Socialism, 665 
Sociology, 427 
Spasmodic advertising, 606 
Speculation theory, 552 
Spending power, 120 
Spinning, 157, 170, 182 
frame, 469 
Spun rayon, 442 
silk, 340 

Stable money, 388 
Stages of business cycle, 544 
Period of crisis, 544 
of depression, 544 
of prosperity, 544 
of recovery, 544 
Standards of living, 73, 76, 121 
Standards of practice, 628 
State banks, 412 
paternalism, 85 
Statute law, 89 
Stock, 209 
capital, 209 
common, 209 
preferred, 209 
Stockholder, 209 
Stock-record card, 539 
Strength in banking, 423 
Strikes and boycotts, 660 
and casualties, 636 
Style, 48, 50, 52, 433 
conservative, 44 
exclusive, 44 
popular, 44 
staple, 44 
ultra, 44 

Style promotion, 433, 622 
Substitute materials, 453 
Successful advertising, 606 
trading, 348 
Suggested policy for international 
trade, 383 


remedies to eliminate or lessen the 
evils of the business cycle, 556 
Suggestibility, 39 
Suggestion, 35 
Sunspot theory, 547 
Supply, 11, 220, 391 
Survival of handmade textiles, 197 
Synthetic fibers, 437 
Systems, 155 

Tariff, 376, 587 
Commission, 384 
Taste, 26 

Taxes, 17, 640, 667, 670, 671 
Terms, 3 

Testing laboratory, 350, 457 
Texas cattle, 363 
Textile credits, 411, 419 
processes, 156 
research, 456 
Textiles, 1, 197 
Theatrical costumes, 46 
Theories to explain the business 
cycle, 509 

over-production theory, 549 
political theory, 549 
speculation theory, 552 
sunspot theory, 547 
unequal distribution of wealth, 553 
Theory of diminishing returns, 13 
of packing, 619 
of color, 619 
of design, 619 
of shape, 619 
of typography, 619 
Thrift, 120 
Thrown silk, 340 
Touch, 26 

Trade associations, 634, 658 
Trade journals, 615 
Trade-marking policy, 600, 603 
Trade-marks, 147, 461, 483 
characteristics, 484 
history, 483 
importance, 483 
laws, 485 





INDEX 


683 


modern conception, 487 
registration, 488 
Trade organizations, 276 
Trading, 348 

Trading on cotton exchange, 310, 318 
Training, 259 
Training units, 259 
Traits, 39 
Transfers, 258 
Transportation, 9, 583 
Act, 586 
air, 593 
disputes, 594 
finishers, 595 
importance, 583 
system, 583 

Traveling salesman, 286 
Trial balance, 509 
Trust companies, 417 
Type of advertising, 602 

Undermining advertising tactics, 629 
Under-population, 99 
Undesirable trade practices, 571 
Unemployment, 656 
Unequal distribution of wealth, 553 
Use of wearing apparel, 73 
Uses for discarded clothing, 150 
Utility, 4, 5, 105 
of clothing, 104 
decorative, 4 
elementary, 4 
form, 4 
place, 4 
possession, 5 
protective, 4 
quantitive, 5 
time, 4 

Value, 108 
market, 10 
ordinary, 10 
Value of credit, 424 
Variations in prices, 112, 300 
Varieties of appeal in advertising, 610 
Variety in clothing, 120 


composition, 120 
design, 120 
finish, 120 
position, 120 
structure, 120 
use, 120 
Viscose, 439 

Vocational industrial education, 100 

Wages, 13, 260, 271, 640, 644 
bonuses, 77 
commissions, 644 
fees, 14 
money, 14 
piece, 14 
real, 14 
time, 14 
Warranties, 637 
Wash sales, 312 
Waste, 103 
Wealth, 5, 49, 641 
Wearing apparel, 73 
Weaving, 158, 163, 180 
Weighted goods, 452 
Weighting of silk, 451 
Welfare work for employees, 664 
Westward trend of industry, 169 
Wholesaler, 109, 285 
Will, 23 
Wool, 330 
industry, 575 
manufacture, 177 
market, 326 
trade, 368 

Workers, 254, 262, 653 
Workings of a bank, 402 
Workmanship, 108 
Worsted yarn quotations, 336 

Yarn cost-card, 530 
costs, 529 
sizes, 529 
Yarns, linen, 533 
raw silk, 533 
spun silk, 533 
woolen, 531 
worsted, 531 















■ 



















« 




• v 








. 

* 


















1 
o , 

« 




%&* 


r 


* ^ 

• \# 

* $ %, ■V'g"§ v < ■$.>' ^ 

A ' ' 

a „«■'*. <* 

.* A * 

» ^ A * 



♦ & * 

° * ** 4^ ». ^ *' * * s a 

C ° W * 



Jp %. » 

„ * r\ *V * 

‘‘TV’ A?° ^ * 

i> j<y . >'^Lr * *> V , 

^ A 0 ^ 91 ^% <*> A * 




S$> * ® 




.<£* * 

,. »»«' A K ° r f, *»>’* ' A° 

" ' N c\ -tPs^anL* 

• ' / oV • 

* A '%> - A^*V * 

.* «y ^ %%S v V - 

\ <*'«'•.’;• <0 v?, *«?; A <x '*•*- < 

*% r 0 V ^ ^ 0 0 ^ •* 
< V V<s£\XVaf*i_ «> ^ * Jf/;/%. „ 'T'. v 

* *£» 4 ' 

^*CT 


* V** 

A^ «*» ° 

A ° 




«5<3> 






> ***** <y % f° «> °^ * 

^ V d f # °* ,0 *2JrLV ^ v * T * °* CV 



5» £< 


■3 <A « 


. Vk^ * 

* A V °« 


^ % '^’f' ’ A 
o^.-V 



o • * 



« ,/ % %w , . 

* a° 'V ♦?frr» a 

. o jt *wz2%,* c. 0 ° A ** 

» / °^ _ •. 


A v* 




^Su.. •J’ 


‘TT-.*’ a 0 V ‘ 

o. A *> 



^ * •«» 0 <■?■’ 



*o V 


» 0, v'. 




a0 %\LLr 


*<b ^ 





v v 

^ A* *V 

r VC 

^ CP ^rs 

■* c* ^ 

4 -a. v v j* * ~ A wp*is r % 

<v w o m i' iCy V> A ^ 

. i •» <&. n v . o * »,* a*^ * K1 * * 

*CW» ^ c° *^ 5 ^% o ^ 

’ .'*^&*. ^ v * :4(^*. 

. *° 0 A v °^> ^* ' 1 *" A°° .. ^''♦•To*- *• 

> V % # Vv a0 v * !/nl% V* V *!, o. 

V\ V , V'V • - V-^v V .A\^//Ao -v>. 




•$»>', 


<v c * 

■T V*. 



* ^ °* > 


^ Y o A 

' o«JL*% O 0 A Jp ^ 




*. ^O 


A lA A 

* <t? * 

• is ^ * <ay ti* < 

v ... C '“*‘' „,. '. 

, 0 V * # c> 

+ ‘—. 0 * O 


JV * V # » ■» 


SP ^ ^0 - 1 

C a0 ^ * 



<j 5 ^ 

<lT ° j 

«-*"’• ^ ,. ^ V ,.„ V^ ,, ^ - 

%. A* . v > 5 iK'. '*❖. .C to V. 



0 


^V‘• • • * 

|Mk§§& - ^<v +$V$t/b)°o ^ ^ * 

w- J& '®i* tf :JiSI'- W 

W‘ a? ^ •JSK** 4?x -M&: f \ : .l 

’•t 11 <0 V "r> ♦;**?>•*%* A , • «»,;« ^ 

A V V ° • * \G \b *7 

^ ^ ,0^ .»’•» ■*£? 

* jw 725*» f __ Vj,. 0 * ^> 


: w . 

/ ^ •% -. 

-•. T * .0* ■'^©fT'' ^ 

,0* .<■?•, <b 

^ « «%^K* o j -4 , 

CV 0 * ^ 0^ 


' • • ■‘ A <V <, 

AV « i » * <J> 

’ A* *W^_ t 


t * O, 



<* ^ d< 

^ c5 


4 o JWf^ o % 

y* ' *t> 

%> / .*,% ^ 

® AWyZ^v///! o 

« 'C^WirV*’ «N * 

* ^ <'?' „ 
O > • -t 


iT C 

7 % . "* / ✓'■/• /i K W~V V" »\ - "V 

r » a v <<. J* 

• ^ * ■vyf?.* ^ % \ 

4 \‘^, **_ <!>* sm'+o 


r ^ 

** •• 0 ° ~V*^’>*‘ %'^'\o 

v .!•». V . 9 * 
*-*-* ■*. tf. A 4 * 

,o <£ . 


i. - ^-C(A' <tv ^ t n /u . «* 

% *••’• A° V • 

^ vrfc ^ , v v 

% - - s ^, : .\ 



♦ 

X* ^P> <t 
/$< V* cr 


' $°'*‘ > ?<2zmr’ 4 °' 7 ^ *’fr 

°»0 9 ,<?r o *„ f1 ** .0^ ^ "**. 

^ & .'M/C. ^ a^ »VsKs!<« ^ v 

»• ^ :*fe: :/*»'• *■«* 

\V^ * 

( V>. y<» o 

^ *>. 


*■<> * * 


0 " a 


' '£• ^ a0 v 

»^/u% ^ A" 4 / 

°, s s » 

& % \ 

’ ♦ • * * VV- <v „ 7 

■& -•*"- ^ 0 0 v ' 


<V *■ 

,-i 4 , • L JJ- 

. a 4 /jr^', V . 

P ’’ri. ^5 O* •« 



„ «» 

, ^ V V » * * a * r o 

• "% A 4 *>v|^A*. ^ / 

: v-v ^ 

** •bSs * 

a\ • v a*. " * > Ji o. ’■•'..<• A 

a'LS* % r o' .•*•. ^ 0 , 4> ., -, 

^ *va^ * %, «° '*<^k* ° v / 

: <H! * o > 

# ^ '.Ly/ZM ’ 

f»* 0 ° 

A u <5> ^ » 

*> 



• 


xr * ■£/ v Cc> • ^ 

.o^ % *♦ 

,0^ ,•■•. ■*£> 
c ° .o 


. 

• VA, * 

, ^ »'H/Ji8AK'» a- 

, ^tv- > . ^ v * Cs y < <l v 

' ••* A <^ O '«* * * sy 

Jtf , v • r ■& , 

lN ■» Xr \J * 

\ * d£(l//6?> * %£> A < 



0 ^ 
V % *1 • ®» c» 












